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Dow Jones Industrials Index (DJIA) - Knee Jerk Reaction Low »» Monthly Summary Analysis
By: Marty Armstrong | August 17, 2019

OUR ANALYTICAL VIEWPOINT AS OF THE CLOSE OF Fri. Aug. 16, 2019: Dow Jones Industrials closed today at 2588601 and is trading up about 10% for the year from last year's closing of 2332746. As of now, this market has been rising for this month going into August reflecting that this has been only still a bullish reactionary trend. As we stand right now, this market has made a new low breaking beneath the previous month's low reaching thus far 2533960 while it even trading beneath last month's low of 2661621.


Up to now, the market remains neutral on the momentum indicator yet bearish on the short-term trend indicator while the long-term trend and cyclical strength are bearish.

During this year, we have exceeded last year's high thereby making a new historical major high to date and we have been in a bull market for a reasonable period of 10 years.

Meanwhile, our technical resistance stands at 2818645 and it will require a closing above this level to signal a breakout of the upside is unfolding. Nevertheless, our technical support lies at 1881635 which is still holding at this time. At this moment, the market remains between these two projections leaving it neutral on a technical basis.

Our timing models warn that a turning point is due come October in Dow Jones Industrials so we should remain focused. The last cyclical event was a high established back during July. Normally, this implies that the next turning point should be a low. However, the market has been neutral for right now, so caution is advisable. Watch the short-term trading levels for a hint of the next directional move into that target time frame. Last month produced a high at 2739868 but closed on the weak side and so far, we have broken beneath last month's low 2661621 closing yesterday at 2588601. We now need to close beneath 2661621 on a monthly basis to imply a technical reversal of trend to the downside for now. Since we are trading below that level, caution is advisable.

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 7 months. The previous low of 2171253 made during December 2018 on the Monthly level has held and only a break of 2468057 on a closing basis would warn of a technical near-term change in trend. The previous high made during July on the Monthly level at 2739868 remains significant technically and only exceeding that level on a closing basis would suggest a reversal in the immediate trend. However, we still remain below key resistance 2669596 on a closing basis.

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