Dow Jones
Dow Jones had another attempt at the 30,000 level yesterday, and it failed again. This is the fourth time in a row when it tries and finds nothing but sellers.
Yet, as long as the market remains above the rising trendline, the Dow is poised to try again. At this point in time, the index looks like forming an ascending triangle – it keeps pushing against a horizontal base. However, the more it fails, the more sellers would be tempted to try to short it.
Yesterday’s attempt higher came in the context of strong after-hours performance. Futures traded with a bid tone and Powell’s testimony fueled the rally at the opening. But then the cash failed to keep up with the futures and reversed course.
There is something for both bulls and bears in this market. More precisely, bulls may want to go long by the time Dow manages to break and close above the shooting star candlestick showed in the chart below.
On the other hand, bears may want to sell the index on a break and close below the rising trendline. In both cases, they should consider a stop at the opposite market swing while targeting a risk-reward ratio of at least 1:2. Anything is possible at the current levels.
