DJA closes higher for the 4th day in a row
Dow Jones Composite Average Index (DJA) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, DJA ended Wednesday at 9307.08 gaining $15.94 (0.17%). Trading $91.32 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (DJA as at Sep 16, 2020):
Wednesday's trading range has been $106.56 (1.14%), that's slightly below the last trading month's daily average range of $124.06. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for DJA.
One bearish candlestick pattern matches today's price action, the Shooting Star. The last time a Shooting Star showed up on July 21st, DJA actually gained 0.52% on the following trading day.
Prices are trading close to the key technical support level at 9210.28 (S1).
While the stock index is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Shooting Star" stand out. Its common bearish interpretation has been confirmed for Dow Comp.. Out of 20 times, DJA closed lower 70.00% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after five trading days, showing a win rate of 70.00% with an average market move of -0.08%.