Allstate Corp’s. (ALL) up move since 2009 was broken into two phases. The first leg of the rally lasted for over 2 years but with a return of just 40%, the second leg of the rally however began in Oct 2011 and has signaled an end now, 20 months after it began, with a total return on investment of over 82%. The second leg of the rally started with the original resistance, signaling an entry, at 25.6 with an entry price of 26.4 in October 2011. The exit has been signaled on the break of an important resistance at 47.1 with a close at 46.6.

Now the stock looks to be in a downwards to sideways zone, critical support lies at 41.5, which if broken significantly will send the stock into a long sideways cycle to a bearish cycle. As of now the stock is an exit for investors. 

The DOW has been in a strong up-move since Jan 2013, after a consolidation phase of over 10 months from March 2012 to Jan 2013. For the first time since the up move began we might be seeing some form of a consolidation happening. Taking into consideration that this present consolidation is coming after the second leg of the up-trend that began in 2009, this might be a deeper consolidation or if spoken too early, a future topping possibility. But for now let’s not call it anything more than just a consolidation as the up-trend has been very strong. Supports and resistances are as follows.

Supports – 14684.5, 14382
Resistances – 15542.5, 14902

The support at 14684.5 is a pivot, which if broken the Dow might turn sideways to slightly downwards but with a major support just below it at 14382. Any down trend will have to result in 14382 being breached significantly else we’ll see a bounce back from these levels for a continued up-trend.

Resistances are at 14902 which is only a minor resistance for now, while major resistance lies at 15542.5, upon breaching which the consolidation phase will end and the up-trend will resume.