Long time - a look at the DOW

It's been a while , the main reason being that the market has been in a low volatility long term rally but in the last 2 weeks all has changed.

Up to 2 weeks ago the majority were all expecting new highs for the US markets, me included, however since then bullish investors have had a wake up call; the buy and hold scenario may be changing - MAYBE.  Volatility is great if you are nimble.

What do the charts show - remembering that a chart fo a stock, market, commodity and any other trade able instrument shows the underlying behaviour of market participants at any one time.
They don't predict the future nut they CAN tell you how these investors behaved at previous price levels in the past, which can help to formulate a plan for the future direction - remembering that in markets there can always be more than one option so an open mind is essential - don't get welded to your view ! 

DOW:  headline index - makes all the news!
Looking at the LONG term...steeping back

DOW MONTHLY

What does it show:

1.  the market has been in an uptrend since 2008 (financial crisis) - 10 years
2. After a minor correction in late 2015 early 2016 the rally resumed at a steeper angle, buyers more aggressive
3 The recent fall is testing the accelerated up-trend line  KEY level.  Hold here and a rally to new highs is likely.
4.  A BREAK below here could see downside to the long term trend line.

Remember this is a long term chart ..good to look at different time frames to get ideas about long term perspectives.

DOW WEEKLY

This shows a closer look at the longer term. It clearly shows that 24000 is the key level.  However in my experience it will likely overshoot a little..the key here will be if it rebounds quickly...

DOW DAILY

POINTS

1. Possible positive divergence on daily chart between price and RSI - not confirmed yet

2. Seems to coincide with the steeper uptrend

So at the moment I would say that the market is close to finding support at around 24000, with a possible overshoot to below but a quick recovery.

Then a re-test of the low before the rally resumes could tie in with after elections in USA.

CAVEAT:  this is just one scenario but IMHO it's all about probabilities and behaviour.  A word of warning - if you use CNBC take it with a pinch of salt - entertainment.

Next post : looking at smaller time frames