In this video we are going to talk about the Dow Jones Industrial Average (DJIA) & look at the rally that has been happening since the last 12 months. We will also look at the high probabilities we're seeing that the DOW might top-off very soon & we'll also talk about the new support & resistance levels where this can be predicted.
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.