DJIA closes above its opening price after recovering from early selling pressure
Dow Jones Industrial Average Index (DJIA) Technical Analysis Report for Oct 09, 2019 | by Techniquant Editorial Team
DJIA ended Wednesday at 26346.01 gaining $181.97 (0.7%). Trading up to $58.45 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on October 3rd, DJIA gained 1.42% on the following trading day. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (DJIA as at Oct 09, 2019):
Wednesday's trading range has been $174.56 (0.66%), that's below the last trading month's daily average range of $258.86. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for DJIA.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical support level at 26222.32 (S1). Prices are trading close to the key technical resistance level at 26465.32 (R1). After having been unable to move above 26421.81 in the prior session, the Dow ran into sellers again around the same price level today, failing to move higher than 26424.31.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Selling could accelerate should prices move below the nearby swing low at 26139.80 where further sell stops might get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Dow Indu.. Out of 599 times, DJIA closed higher 56.09% 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 63.27% with an average market move of 0.41%.
With four out of the other six Major World Indices closing higher today, the ones that stand out on the positive side are NDX gaining 1.13% and DAX closing 1.04% higher. On the flipside the worst performers have been HSI closing -0.81% lower and NKY losing -0.61%. Read more