- Summary:
- Dow Jones rising wedge puts pressure on Dow Jones. However, the price action remains bullish while the index holds above the 30k level.
Dow Jones futures point to a higher opening today. After the end of year rally, the bias is that 2021 will be a positive one for the Dow Jones too.
Historically speaking, every time when the U.S. stock market gained more than 10% in the last two trading months of the year, the performance in the upcoming January was positive too. Moreover, the performance for the entire following year was in the double-digits too.
Therefore, the bias moving forward remains bullish. As the world slowly wakes up after the end of the year holidays, the Dow shows only marginal highs on any attempt to break higher.
Dow Jones Technical Analysis
Since the last November U.S. elections, the Dow Jones index jumped aggressively. But from the moment that the index reached the 30,000 level, any advance was just marginal. In fact, technical traders call this pattern a rising wedge, with many trying their hand at shorting the market when the price reaches the upper edge of the pattern.
Well, the price is at the upper edge, and bears have an incentive to sell. However, the bias remains bullish as long as the market holds above the 30k level. In other words, it is safer to sell a break below 30,000 than to sell at the upper edge of the pattern.
Dow Jones Price Forecast
