Market Direction and Stock Trends

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Dow Jones Industrials Index Cash Analysis
By Marty Armstrong | July 22, 2017

Analysis for the Week of July 24, 2017

Dow Jones Industrials FORECASTING ANALYSIS FOR CLOSE OF Fri. Jul. 21, 2017: Pinpointing time for a turning point on our monthly models, we see the next target unfolding during this month in Dow Jones Industrials at least on a closing basis if not intraday so pay attention. The key week ahead for a turning point is 7/24. Last month produced a high at 2153503 and so far we are trading neutral within last month's trading range of 2153503 to 2099422. We need to breakout of this range to confirm the direction. Therefore, a close above will be bullish and a close below will warn of a possible decline. Here we have a long-term bullish trend in play since the historical low took place back in 1896 followed by the historical high in 2017, which constituted a 121 year rally. As of the close of Fri. Jul. 21, 2017, the market is immediately in a neutral position for right now yet we are trading above the December 2016 high. Nevertheless, the market reamins firm as long as it holds above 0. Dow Jones Industrials closed today at 2158007 and is trading up about 9.19% for the year from last year's closing of 1976260. Thus far, we have been trading down for the past day, following the high established Thu. Jul. 20, 2017.

On the weekly level, the last important high was established the week of July 10th at 2168153, which was up 12 weeks from the low made back during the week of April 17th. We have been generally trading down to sideways for the past week from the high of the week of July 10th, which has been a move of 0.97% percent in a stark panic type decline. The broader perspective, this current rally into the week of July 10th has exceeded the previous high of 2153503 made back during the week of June 19th. We have seen a rally so far from the last low at 2037955 made the week of April 17th, and only a break of that low would signal a technical reversal of fortune. Otherwise, the market remains strong at this time. Right now, the market is above momentum on our weekly models hinting this is still bullish for now as well as trend, long-term trend, and cyclical strength. Looking at this from a wider perspective, this market has been trading up for the past 3 weeks overall. Interestingly, the Dow Jones Industrials has been in a bullish phase for the past 7 months since the low established back in November 2016.

Critical support still underlies this market at 1913878 and a break of that level on a monthly closing basis would warn of a decline ahead becomes possible.

Rationally, my long-term view analysis recognizes that the current directional movement since the low made back in August 2015 has been an extended Bullish trend in Dow Jones Industrials which remains in motion as long as we hold above 1733105 on a monthly closing basis. It is incredibly important to identify the broader trend for that is the underlying tone. It is wise to take position counter-trend only with this understanding of what you are doing.

Consequently, this has been a 8 year rally in motion since 2009. Caution is advisable since this is also 8 years up from the low of given that was the major low 2009. We must pay attention to the closing for this year. If we close lower at year end, beneath 1976260, then we can see a pause in the uptrend into next year. Penetrating intraday last year's low of 1545056 will confirm a serious correction into next year. However, we have rallied to exceed last year's high last month. We need to see a closing above 1998763 at year-end to see a continued rally is possible into next year. Exceeding this year's high next year and holding last year's low intraday will signal the bullish trend is still intact. A breach of last year's low of 1545056 intraday will negate that outcome.

Directing our attention to the longer term yearly level, we see turning points where highs or lows on an intraday or closing basis should form will be, 2022, 2024 and 2026. Considering all factors, there is a possibility of a decline moving into 2022 with the opposite trend thereafter into 2024. This pattern becomes a possibility if last year's low of 1545056 is penetrated even intraday. Honing in on the volatility models suggest we should see a rise in price movement during January. We look to the turning points to ascertain the direction. Volatility targets reflect only volatility. Focusing on the potential for sharp movement, our Panic Cycle targets for the period ahead to watch are during 2026. Keep in mind that a Panic Cycle differs from just volatility. This can be either an outside reversal or a sharp move in only one direction. Panic Cycles can be either up or down. Watch the oscillators and the reversals to determine the best indication of the potential direction.

Bearing in mind the immediate momentum is Bullish on the weekly level yet we did penetrate the week of July 10th's low. This is warning to pay attention since last month had closed higher so the upward momentum is weak on the monthly level. To date, the market has exceeded last year's high of 1998763. In order to maintain an upward advance, we need to close above last year's high at year end. Currently, this market remains in an uptrend posture on all our indicators looking at the weekly level. We see here the trend has been moving up for the past 13 weeks. The last weekly level low was 2037955, which formed during the week of April 17th. The last high on the weekly level was 2168153, which was created during the week of July 10th. On a broader perspective, this market remains in an uptrend posture on all our indicators looking at the monthly level. We see here the trend has been moving up for the past 22 months. The last monthly level low was 1537033, which formed during August 2015. The last high on the monthly level was 2153503, which was created during June.

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