Good morning dynamic traders,
The Dow Jones has been in a decline since October 2007 and from March 2009 this market has bounced. More recently it tagged a resistance point and has again started to decline postMACD divergence.
If we examine the daily Dow a little closer we can see that a head and shoulders has formed at the VI. Right now we are close to the figure but if the decline continues short term then we might see further weakness of another 500 points. Beyond that support we have room for another 1000 points.
This will be a concerning time for the Dow and the S&P is not too disimilar so let's wait and see what develops here as of course this could be some form of profit taking. Why not study the chart and make up your own mind.
Chart courtesy of Advanced Get. Data supplied by eSignal.