DJIA finds support at 200-day moving average
Dow Jones Industrial Average Index (DJIA) Technical Analysis Report for Feb 08, 2019 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, DJIA ended the week 0.17% higher at 25106.33 after losing $63.20 (-0.25%) today. Trading up to $159.36 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (DJIA as at Feb 08, 2019):
Friday's trading range has been $223.35 (0.89%), that's slightly below the last trading month's daily average range of $242.28. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for DJIA.
After trading as low as 24883.04 during the day, the index found support at the 200-day moving average at 25004.84. The last time this happened on May 3, 2018, DJIA gained 1.39% on the following trading day.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could speed up should prices move above the nearby swing high at 25439.04 where further buy stops might get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Bounce off SMA 200" stand out. Its common bullish interpretation has been confirmed for Dow Indu.. Out of 13 times, DJIA closed higher 69.23% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 76.92% with an average market move of 1.56%.
With four out of the other six Major World Indices closing lower today, the ones that stand out on the negative side are NKY losing -2.01% and DAX closing -1.05% lower. On the flipside the best performers have been NDX closing 0.12% higher and SPX gaining 0.07%. Read more