Dow Jones: Wall Street could undertake a new corrective leg

The Dow Jones could begin a new phase of decline

From a technical analysis perspective, the outlook for the Dow Jones is turning down as the index has formed a “marubozu”, a Japanese candlestick pattern in favor of a reversal.

This figure was formed after an 8% surge in the equity market, for no particular reason, which reinforces the chances of a new leg of decline in the indices.

Last week’s low at 34,325 points will be the first support to watch, followed by the neckline of the former head and shoulders reversal pattern at 34,000 points, then February/March lows below 33 000 dots.

The bearish outlook would be invalidated in the event of a bounce above the week’s high at 35,383 points. In this case, a continuation of the rise to the February high at 35,820 points would be expected.

Entry: Sale below 35,000 points

Stop: 35,380 points

Objective: 33,000 points

Risk/return ratio: >2

Follow the evolution of the Dow Jones price with IG.

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