Stock Trading Predictions & Technical Analysis: Dow Jones

Friday, April 16, 2010

Dow Jones - Where is it heading next?

Dow Jones - WAIT

After exactly hitting its weekly 200 day MA around 11150, the Dow Jones pulled back sharply. The weekly 200 day MA is a critical resistance level which when it will be broken will trigger a STRONG BUY SIGNAL. Right now it's hard to say if the Dow Jones will bounce back up higher next week or experience perhaps a small correction. When we look at the daily chart, we can see that the Dow Jones' major up trend is still intact above its 20 day MA (middle green dashed lines). The daily 20 day MA currently stands around 10950. The question for next week is whether or not the Dow Jones will manage to hold above this level (20 day MA). A bounce back up the daily 20 day MA will have the Dow Jones resume its major up trend and we could then perhaps see it break above its weekly 200 day MA. However, given the fact that the weekly 200 day MA is such a strong resistance level to break above, I believe that there are good chances of seeing the Dow Jones break its daily 20 day MA next week or the week after, and therefore trigger a STRONG SELL SIGNAL. If this occurs I do believe we should have a small correction towards the following support levels: 10750, 10500, 10300, 10100, 9900-10000. If the Dow Jones falls below its daily 50 day MA (currently around 10600) there will be a potential of seeing the Dow Jones move down towards its daily 200 day MA currently standing around 10000. We should have a better idea where the Dow Jones may be heading next, next week, and because we are at a level of uncertainty I have issued a WAIT signal.

Weekly Chart

Daily Chart

No comments:

Post a Comment

DISCLAIMER

The analysis and information given on this site is for information purposes only. Trading in these strategies may result in capital loss. Individuals should do their own independent research or consult an investment advisor before taking investment action. All materials on this site, including the stock picks, are for news and entertainment purposes only and are provided on an "as is" basis and without warranties of any kind, either express or implied.

Under no circumstances will yoel stockpredictions.blogspot.com be liable for any special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if advised of the possibility of such damages including, but not limited to, negligence. In no event shall yoel-stockpredictions.blogspot.com have liability to you for any damages, and losses for accessing this site or using the information provided.Yoel-stockpredictions.blogspot.com does not guarantee that the information contained herein or distributed from this site will be uninterrupted or error-free, that defects will be corrected. Past Results are not necessarily indicative of future performance.

Yoel-stockpredictions.blogspot.com does not trade against you. Some sites are using the size of their visitors to 'move the market' and take advantage personally with their stock picks. This is illegal, and mostly applicable in smaller less liquid securities, which are not covered on this site. It is highly unlikely that the articles in this site about stock picks could ever move the market.

As a visitor to this site, you acknowledge and agree that any reliance on or use by you of any information available on this site shall be entirely at your own risk. In no event shall yoel-stockpredictions.blogspot.com be liable for any direct, indirect, consequential or exemplary damages arising from the use or the performance of this site, even if will yoel-stockpredictions.blogspot.com has advised of the possibility of such damages. Trading may not be suitable for all visitors of this site or the information provided by this service. The visitors assume the entire cost and risk of any trading they choose to undertake.

TECHNICAL INDICATORS

BUY SIGNAL: Indicates the possibility of the start of a new up trend or the continuation of the current up trend. This signal may be often given in the early stages of a potential new up trend that was preceded by a down or sideways trend. Such signals do not always succeed and may fail at time.

BUY: Indicates that the current up trend is already in motion and a BUY SIGNAL was already given earlier. A BUY does not necessarily indicate that the stock will continue higher from here, but simply that the stock is trending up. The further into the trend you decide to take a long position, the more risk you have of seeing it reverse back down sooner rather than later.

STRONG BUY SIGNAL: Indicates a stronger, more significant and reliable signal than a BUY SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG BUY: Indicates that the current up trend is already in motion and that STRONG BUY SIGNAL was already given.

SELL SIGNAL: Indicates the possibility of the start of a new down trend or the continuation of the current down trend. This signal may be often given in the early stages of a potential new down trend that was preceded by an up or sideways trend. Such signals do not always succeed and may fail at time.

SELL: Indicates that the current down trend is already in motion and a SELL SIGNAL was already given earlier. A SELL does not necessarily indicate that the stock will continue lower from here, but simply that the stock is trending down. The further into the trend you decide to sell a position, the more risk you have of seeing it reverse back up.

STRONG SELL SIGNAL: Indicates a stronger, more significant and reliable signal than a SELL SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG SELL: Indicates that the current down trend is already in motion and that STRONG SELL SIGNAL was already given.

HOLD: Indicates that traders who already hold this stock, should hold on as long as the trend persists. This signal is usually given during an up trend for which it would be considered too risky to take a long position at this point.

STRONG HOLD: Indicates that the current trend has been in motion for a while and rarely deviated away from the trend. Although the stock may continue higher, there may not be enough potential up side to trigger a BUY SIGNAL. This type of indicator usually means that the stock has very strong support levels which may have been tested but not broken.

WAIT: Usually given during a sideways trend for which we are waiting for a move that would trigger a BUY SIGNAL or SELL SIGNAL. This could also indicate uncertainty and the risk that would be taken if you were to take a long position at the current level. Taking a long position after giving a WAIT indicator is considered a gamble.