The 15 Minute chart of the Dow Jones Industrial Average shows a downside consolidation, followed by the expected move down – but not quite to the projected target. The thing to watch on this is a weak opening and a push down to 23,400 which is short term support. I would expect a push up from there. If not, we go to the Daily Chart…
The Daily Chart shows the same long consolidation we have seen forming for about a month, with upper boundary at about 25,000 and lower at 23,000. With the implied weakness, we want to watch for a solid break through 23,000. This will indicate that the market is probably going lower.
With the market’s upside bias, we know it has to be pricing in a recovery. With incoming news about closures, layoffs, and bankruptcies, we have to wonder if it will continue to hold its ground, and for how long? Many believe the reality of economic distress and uncertainty about resuming business as usual will grab hold of the market and drive it lower in coming weeks. Charts appear weak this evening. I expect a down open, but will we breach support at 23,000? Probably not. The market seems to be happy hanging out in here – for now.