Spectacular plunge observed on the dji. I was always bearish on this counter no doubt. Now look at it. I had breached the 13000 level which I have mentioned and dropped more. Let's look at when we can drain some money from this hard and fast correction.Levels as I mentioned were tested and down down jones goes..Haha. As mentioned 13290 was a very clear support turned resistance which was tested multiple times last week before it gives the Big boys the go ahead to plunge the market (tat's what i feel) ;)
Okay a few things to note, this is a diagonal triangle and a completed A-E waves were formed. Thus, in fact a break down from the lower trendline spell trouble for DJI. Enough of the talk and let's go back to the fundamentals.
Resistance and support:
R1=13000
R2=13290
S1= 12826 (as now DJI still lingering over that region)
S2= 13560
Waveform: This wave down is considered a Wave C and it should consist five wave down I have labeled them as C-1,C2 and C3. I am expecting C3 to stop at either 50% (12820) or at 61.8%(12560) region. This will initiate a relief rally up to 13000. And from there this support turned resistance should be stopping further up move and turn the market further downwards towards 12000 which is my expected target for wave 5 of this wave C correction.From what i see on last friday's market actions, people are clueless what to do thus the doji-like candle which was formed. Let's c how Monday goes. If 13000 is retested again. It will be a good target to short with conviction!Cheers!
Indicator:No divergence seen as of yet.
Interesting, do you trade cfd on dow index? I only trade cfd with local stock.
ReplyDeleteHi This is a futures for DJI...cfd if i am not wrong only will trade on futures.
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