DJIA Technical: Bulls retreated again at key range resistance - MarketPulse

DJIA Technical: Bulls retreated again at key range resistance – MarketPulse

Time Stamp: July 16, 2023 10:21 PM
Source Node: 2767325

  • Dow Jones Industrial Average (DJIA) has underperformed the S&P 500 and Nasdaq 100 in the past two weeks.
  • Last Friday’s initial bullish price actions of DJIA retreated at 34,630 key range resistance.
  • Minor uptrend from the 10 July 2023 low of 33,595 has shown signs of exhaustion.

Last week’s advance halted at 7-month range resistance

Fig 1:  US Wall St 30 medium-term trend as of 17 Jul 2023 (Source: TradingView, click to enlarge chart)

Since the 13 December 2022 high of 34,944, the US Wall St 30 Index (proxy of the Dow Jones Industrial Average futures) has continued to oscillate within a 7-month sideways range configuration.

The 3% rally from the 10 July 2023 minor low of 33,595 has been rejected at the 34,640 range resistance for the third time last Friday, 14 July, and confluences with a major descending trendline that capped previous up moves since the 29 March 2022 high.

Short-term momentum has flashed a bullish exhaustion signal

Fig 2:  US Wall St 30 minor short-term trend as of 17 Jul 2023 (Source: TradingView, click to enlarge chart)

The hourly RSI oscillator has flashed a bearish divergence signal at its overbought region which suggests that it is likely the upside momentum of the minor short-term uptrend from the 10 July 2023 low of 33,595 has been exhausted which in turn increases the odds of a minor decline.

Watch the 34,630 key medium-term pivotal resistance to maintain the short-term bearish bias with near-term support coming in at 34,320. A break below it exposes the next supports at 34,000 and 33,840.

However, a clearance above 34,630 sees a potential bullish breakout from the 7-month range with the intermediate resistance coming in at 34,940 in the first step.

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Kelvin Wong

Based in Singapore, Kelvin Wong is a well-established senior global macro strategist with over 15 years of experience trading and providing market research on foreign exchange, stock markets, and commodities. Passionate about connecting the dots in the financial markets and sharing perspectives around trading and investment, Kelvin Wong is an expert in using a unique combination of fundamental and technical analyses, specializing in Elliott Wave and fund flow positioning, to pinpoint key reversal levels in the financial markets. In addition, over the last ten years, Kelvin has conducted numerous market outlook and trading-related seminars, as well as technical analysis training courses, for thousands of retail traders.
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