Tag: Dow Jones Industrial Average

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Dow scare tactics

I wish I had a dollar for every time the 1929 Dow has been superimposed over the current index. Like this effort at Zero Hedge.

Dow Jones

Why did the analyst select a period of two years? Because that is the period that fits.

Dow Jones

If we compare the period 1920 to 1933 to the last 13 years, 2001 to 2014, there is a significant difference.

Dow Jones 2001 to 2014

By 1929 the Dow had climbed roughly 400%, while by 2014 the Dow gained roughly 50% over a similar time period.

Superimposing charts one on top of the other has no sound basis in technical analysis and should be viewed as an attempt to scare the market into a sell-off. A correction may be overdue, but there are always potential buyers hoping for much lower prices.

Hat tip to John B. for sending me the Zero Hedge chart.

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Bullish outlook despite retracement

Dow Jones Industrial Average retraced to test short-term support at 16000. Breach would suggest a correction to test the rising trendline at 15500. Mild bearish divergence on 13-week Twiggs Money Flow warns of medium-term selling pressure. Target for the advance is 16600* and respect of support at 15500 would suggest another advance.

Dow Jones Industrial Average

* Target calculation: 15700 + ( 15700 – 14800 ) = 16600

The S&P 500 is also testing short-term support, but at 1800*. Bearish divergence on 13-week Twiggs Money Flow warns of medium-term selling pressure. Breach of support would signal a correction to the rising trendline around 1730. Respect of the trendline would indicate a healthy up-trend.

S&P 500

* Target calculation: 1725 + ( 1725 – 1650 ) = 1800

CBOE Volatility Index (VIX) below 15 continues to indicate low market risk.

VIX Index

Bellwether transport stock Fedex displays a huge surge on the monthly chart, with rising Twiggs Money Flow indicating strong buying pressure. A bullish sign for the US economy.

Fedex

* Target calculation: 100 + ( 100 – 70 ) = 130

The Nasdaq 100 continues its accelerating up-trend. Rising Twiggs Money Flow, with higher troughs above the zero line, indicates strong buying pressure. Target for the advance is 3550*. Reversal below 3350 would warn of a correction. Short corrections and narrow consolidations are typical of an accelerating trend. Unsustainable in the long-term, accelerating trends almost inevitably lead to a sharp correction.

Nasdaq 100

* Target calculation: 3400 + ( 3400 – 3250 ) = 3550

Overall, I am bullish on the US market. Attempting to time entries and exits from secondary movements is expensive and our strategy at Research & Investment is to remain in the market unless risks become elevated.

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Dow leads US climb

Dow Jones Industrial Average is advancing strongly, with rising 13-week Twiggs Money Flow indicating medium-term buying pressure. Target for the advance is 16600*. Retracement to test the new support level remains likely, however, and respect would confirm the advance. Reversal below 15700 is unlikely, but would test the secondary rising trendline around 15500.

Dow Jones Industrial Average

* Target calculation: 15700 + ( 15700 – 14800 ) = 16600

The S&P 500 is testing resistance at the target of 1800*. Rising 13-week Twiggs Money Flow indicates medium-term buying pressure. Reversal below 1750 would warn of a correction to the secondary trendline at 1700. Short corrections are indicative of strong buying pressure.

S&P 500

* Target calculation: 1725 + ( 1725 – 1650 ) = 1800

CBOE Volatility Index (VIX) continues below 15, indicating low market risk.

VIX Index

The Nasdaq 100 continues its accelerating up-trend. Rising Twiggs Money Flow, with higher troughs above the zero line, indicates strong buying pressure. Target for the advance is 3550*. Reversal below the latest trendline would warn of a correction. Short corrections and narrow consolidations reflect an accelerating trend, or blow-off. Steep gains, however, almost inevitably end with a sharp fall.

Nasdaq 100

* Target calculation: 3400 + ( 3400 – 3250 ) = 3550

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Dow follows through

Dow Jones Industrial Average followed through above 15800 after breaking resistance at 15700 to signal a fresh advance. Expect retracement to again test 15700 in the next few weeks, but respect of the new support level strengthens the breakout signal. Long-term target for the advance is 16600*.  Rising 21-day Twiggs Money Flow indicates medium-term buying pressure. Reversal below 15500 is unlikely, but would warn of another test of primary support at 14800.

Dow Jones Industrial Average

* Target calculation: 15700 + ( 15700 – 14800 ) = 16600

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Dow signals fresh advance

Dow Jones Industrial Average broke resistance at 15700, ending the consolidation of recent months and signaling an advance to 16600*. Expect retracement to test the new support level in the next few weeks. Respect would confirm the advance. Penetration of the descending trendline on 13-week Twiggs Money Flow indicates medium-term buying pressure. Reversal below 15500 is unlikely, but would warn of another test of primary support at 14800.

Dow Jones Industrial Average

* Target calculation: 15700 + ( 15700 – 14800 ) = 16600

The S&P 500 is testing short-term resistance at 1775. Breakout would offer a short-term target of 1800*. Bearish divergence on 13-week Twiggs Money Flow appears to have ended. Reversal below 1750 is unlikely at present, but would indicate a correction to at least 1710.

S&P 500

* Target calculation: 1775 + ( 1775 – 1750 ) = 1800

CBOE Volatility Index (VIX) below 15 continues to indicate low market risk.

VIX Index

The Nasdaq 100 continues its accelerating up-trend, with Twiggs Money Flow indicating strong buying pressure. Short retracement is likely and breakout above 3400 would suggest another advance. Accelerating trends, or blow-offs, enjoy rapid gains but inevitably end with a sharp fall.

Nasdaq 100

* Target calculation: 2900 + ( 2900 – 2500 ) = 3400

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Nasdaq accelerates while Dow and S&P500 hesitate

The Nasdaq 100 continues its accelerating up-trend — as indicated by successively steeper trendlines and a rising trendline on 13-week Twiggs Momentum. Accelerating trends, or blow-offs, are well-known for rapid gains but inevitably end with a sharp fall.

Nasdaq 100

* Target calculation: 2900 + ( 2900 – 2500 ) = 3400

The CBOE Volatility Index (VIX) remains below 15, indicating low market risk.

VIX Index

The S&P 500 is edging higher on the weekly chart, but bearish divergence on 13-week Twiggs Money Flow warns of rising selling pressure. Reversal below the secondary trendline at 1700 would indicate a correction to the primary trendline and primary support at 1630.

S&P 500

* Target calculation: 1730 + ( 1730 – 1650 ) = 1810

Dow Jones Industrial Average is testing resistance at 15700. Breakout would offer a target of 16600*. Respect of the descending trendline on 13-week Twiggs Money Flow, however, would confirm the earlier bearish divergence and warn of a correction to primary support at 14800. Breach of 14800 remains unlikely, but would signal a reversal.

Dow Jones Industrial Average

* Target calculation: 15700 + ( 15700 – 14800 ) = 16600

Canada’s TSX 60 is retracing after a strong spurt. Duration of retracements reflect trend strength. Another trough above zero on 13-week Twiggs Money Flow would suggest strong buying pressure. Reversal below 740 is most unlikely, but would warn of trend weakness.

TSX 60

* Target calculation: 740 + ( 740 – 680 ) = 800

TSX 60 VIX below 15 also reflects low market risk.

TSX 60 VIX

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US & Canada: Rising buying pressure

The S&P 500 short retracement at 1750 is a bullish sign, confirming the advance to 1800*. Rising 21-Day Twiggs Money Flow indicates buying pressure. Reversal below 1730 is most unlikely at present, but would warn of a test of primary support at 1650.

S&P 500

* Target calculation: 1730 + ( 1730 – 1650 ) = 1810

VIX below 15 flags low market risk.

VIX Index

Dow Jones Industrial Average is headed for a test of resistance at 15700; breakout would offer a target of 16600*. Recovery above the descending trendline on 13-week Twiggs Money Flow would negate the earlier bearish divergence. Breach of 14800 is unlikely, but would warn of a reversal.

Dow Jones Industrial Average

* Target calculation: 15700 + ( 15700 – 14800 ) = 16600

The Nasdaq 100, with 13-week Twiggs Money Flow troughs well above zero, indicates strong buying pressure.

Nasdaq 100

Canada’s TSX 60 is advancing toward its target of 800*, the trough above zero on 13-week Twiggs Money Flow indicating strong buying pressure. Reversal below 740 is now most unlikely.

TSX 60

* Target calculation: 740 + ( 740 – 680 ) = 800

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S&P 500 and Nasdaq bullish while Dow hesitates

The S&P 500 broke through resistance at 1730, signaling an advance to 1790/1800*. Follow-through above 1750 would confirm. 21-Day Twiggs Money Flow troughs close to zero indicate buying pressure. Reversal below 1730 is unlikely at present, but would warn of a test of primary support at 1650.

S&P 500

* Target calculation: 1710 + ( 1710 – 1630 ) = 1790

VIX below 15 signals low market risk.

VIX Index

Dow Jones Industrial Average is headed for a test of 15700, but bearish divergence on 13-week Twiggs Money Flow continues to warn of a reversal. Breach of 14800 would confirm. Overall sentiment remains positive, however, and TMF recovery above the descending trendline (20%) would be a bullish sign. Breakout above 15700 would offer a target of 16600*.

Dow Jones Industrial Average

* Target calculation: 15700 + ( 15700 – 14800 ) = 16600

The Nasdaq 100 is contrastingly bullish, with 13-week Twiggs Money Flow troughs well above zero signaling strong buying pressure.

Nasdaq 100

* Target calculation: 3050 + ( 3050 – 2800 ) = 3300

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Dow kaPow!

Dow Jones Industrial Average rose more than 300 points, ending its test of primary support at 14750. One swallow doesn’t make a summer, but this is a good start. S&P 500 breakout above 1710 would signal a fresh primary advance.

Dow Jones Industrial Average

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Dow threatens reversal

The S&P 500 broke support at the May high of 1675 and penetrated the (secondary) rising trendline, signaling a correction to primary support at 1625/1630. Recovery above 1700 is most unlikely at present, but would indicate another advance.

S&P 500

VIX crossed to above 20: no-man’s-land between low and high. Follow-through above 25 would warn of elevated market risk.

VIX Index

Dow Jones Industrial Average is testing primary support at 14750. Bearish divergence on 21-day (and 13-week) Twiggs Money Flow warns of a reversal. Breach of 14750 would strengthen the signal. Follow-through below 14500/14600 would confirm. Recovery above 15000 is unlikely, but would indicate a rally to 15700.

Dow Jones Industrial Average

The September quarter-end often heralds a correction as fund managers re-balance their portfolios and shed under-performing stocks. Congressional gridlock raises the probability even higher.

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