Talking Points
- Dow Jones Industrial Average (DJIA) continues to consolidate near all-time highs
-The medium term outlook is for higher prices towards 19,700 and possibly higher levels
-Below 17,800 would force us to reconsider the higher probability technical patterns
Last week was a good week to take a holiday. Dow Jones Industrial Average did increase but only marginally finishing the week up less than 1%. In essence, the market continues to consolidate near its all-time highs. Previously, we were anticipating a technical correction to hold above 18,167. The low last week on US30, a CFD which tracks the DJIA , reached 18,242.
Bottom line is that little has changed from our previous report on July 28 . We are anticipating the medium term trend to remain higher towards 19,700 and possibly higher levels. A move below 17,800 would cause us to reconsider other higher probability patterns.
Chart prepared by Jeremy Wagner
From a sentiment perspective, the number of traders holding long positions in US30 is 5% below levels seen last week while the number of traders holding short positions has grown 5%. Though this is a subtle shift, it does point towards potentially more gains in US30 which supports the medium term outlook. (Learn how to trade with SSI here.)
Interested in a longer term outlook for equities? Download our quarterly forecast here .
Good luck!
Suggested Reading:
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Do your losing trades overshadow your winning trades? Learn about the psychology behind why that might be happening in our Traits of Successful Traders research .
---Written by Jeremy Wagner, Head Trading Instructor, EDU
Follow me on Twitter at @JWagnerFXTrader .
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