DOW JONES gives sell signal

AUD/NZD Potential Inverted Head and Shoulder pattern
February 19, 2014
Σε διορθωτικό κλίμα το Χρηματιστήριο Αθηνών
February 24, 2014

Dow Jones turned downwards yesterday and has given a short-term sell signal after a couple of weeks of rising prices. Dow Jones has not made new all time highs as Nasdaq 100. Dow Jones did not make a double top as S&P. Dow Jones has topped at the 61,8% Fibonacci retracement and as per our wave count has made 7 waves up from its lows at 15340. 7 waves up means that this upward move is a corrective one and that the downtrend will resume to complete the correction that started at 16588.

dowdaily

Dow Jones has reached the Ichimoku cloud that is now resistance. Short-term support is found at 15900 where the 38% Fibonacci retracement of the rise from 15340 is. If this support level is broken, then I would expect the index to push lower towards 15780. Breaking below the 61.8% retracement will increase the chances that we will test February lows at 15340.

dow60m

Dow Jones as expected is turning lower from its 61.8% retracement. The form and pattern of the decline will clear things up  regarding the longer-term trend. Is this lower top a bearish sign that will bring prices to new lower lows below 15340?or is this decline that started yesterday another buy opportunity before we see new all time highs. To see how we trade the US equities markets profitably, become a member today and receive real-time tweets of our trades and analysis. The right analysis on the right time will make the difference between profit and loss.

Thank you for taking the time to catch up on my thinking.

Alexandros Yfantis
Alexandros Yfantis
Fascinated by financial markets, studied International Securities Investment and Banking in the UK, works as a Portfolio Manager in Greece and runs a technical analysis website. Enjoys travelling and spending time with his family and preparing for the black belt in Korean Karate.