DJIA plunges, losing $650.19 (-2.29%) within a single day
Dow Jones Industrial Average Index (DJIA) Technical Analysis Report for Oct 26, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, DJIA ended Monday at 27685.38 tanking $650.19 (-2.29%). This is the biggest single-day loss in over a month. The last time we've seen such an unusually strong single-day loss on September 8th, DJIA actually gained 1.60% on the following trading day. Today's close at 27685.38 marks the lowest recorded closing price since October 2nd. Closing below Friday's low at 28149.82, Dow Indu. confirmed its breakout through the previous session low after trading up to $779.66 below it intraday.
Daily Candlestick Chart (DJIA as at Oct 26, 2020):
Monday's trading range has been $815.66 (2.89%), that's far above the last trading month's daily average range of $376.35. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for DJIA.
One bearish candlestick pattern matches today's price action, the Black Candle.
After trading down to 27370.16 earlier during the day, the stock index bounced off the key technical support level at 27447.08 (S1). The failure to close below the support might increase that levels significance as support going forward. The market closed below the 50-day moving average at 28016.41 for the first time since September 29th.
Although still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(2) below 20" stand out. Its common bullish interpretation has been confirmed for Dow Indu.. Out of 236 times, DJIA closed higher 58.47% 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 65.25% with an average market move of 0.78%.
With five out of the other five Major World Indices closing lower today, the ones that stand out on the negative side are DAX losing -3.71% and SPX closing -1.86% lower. None of the markets managed to end the day in the green. Read more