Market Technical View is a blog that mostly concerns the technical analysis of different financial instruments like indices, commodities, stocks, ETFs and currencies.

All the posts are structured in 3 main chapters that can be found in Content, in the upper right-hand corner of the blog.

Market perspective. The technical approach consists of chart patterns and important support/resistance zones. The purpose of this section is to give directions of the price on short and medium term (a few days up to a few months).

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Thursday, September 22, 2011

Dow Jones Industrial Average (DJIA) Technical Analysis 2011.09.22

Bearish scenario confirmed!

The expected move in Dow Jones Industrial Average finally happened after a period of rising prices that concluded wave c of wave ii.

The FED conclusion of the two day meeting triggered the sell-off and in a matter of hours the index came down to the main support area of $10,775. The intermediate supports at were of little importance in such a devastating price action that reached the previous lows area. However, the first pullback occurred at the $11,267 area (our first support of yesterday).

There are not many things to say now besides that the current area is tempting for closing short positions (or at least to reduce) and we could probably see a reaction.

The 4 hour chart reveals the bigger picture and provides the same bearish outlook. The main target is set around the previous lows (9th of august – $10,500 area). Although the market has a clear down trend we should be prepared to witness rallies of a couple of hundred points.

As we don’t have a bottom yet formed we cannot establish retracement levels.     

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