Could the Dow Jones Industrial Average (^DJI)continue its descent?
In my technical perspective, since the ^DJI’s primary trend which is the 2-year uptrend has just been broken, if this is really a major trend reversal,it’s likely that selling pressure will follow through.Other than that, checkout some of its basic technical indicators. Most of them are pointing downwards like when you take a look at the key moving averages. The DJI was moving above the 50, 100 and 200-day moving averages when it was uptrendingbut is now moving below it as it downtrends.Also, the MACD is sinking below the 0 line and about to make a bearish crossover. Moreover, there could be a 1-month rising wedge pattern forming right now as the ^DJI rallies. If this is indeed a rising wedge (it’s support was actually tested yesterday), a breakdown from this bearish chart pattern could bring the Dow Jones all the way to the 10,000.00 level. This I got by adding the size of the rising wedge to the possible break down point. But before it reaches that marker, there could be some support at 10,588.50.On the flipside, a break above its 1-month downtrend, immediate resistance and the 50, 100 and 200-day moving averagescould bring the Dow Jones Industrial Average back to the bullish track.
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