A Slight Drop In Dow Jones, A Deeper Correction Might Take Place
The Dow Jones Industrial Average dropped by 0.1% as the U.S China trade deal takes a new turn. A significant delay in the U.S China trade agreement might push the Down index south. Technically Dow Jones index has already cleared the high of 16th July at $27360.90.The bullish rally in the Dow index started after hitting the critical low on 31st May at $24689.17.Such an extended price movement in the Dow Jones index usually results in a bearish correction. If the Dow Jones bulls fail to retain the control of the market at the current price level, the price of the Dow Jones index might fall towards the critical support at $27360.90.
A daily closing of the price below the $27360.90 might target the broken triangle resistance at $27158.17 which will not act as strong support. If the Dow index gains bullish momentum from $27158.17, we might see another strong rally in Dow index. Failing to do so, might result in an extensive correction in price. However, the current corrective patterns in the Dow index might be limited by the critical support level at $27360.90 since we have plenty of supportive candles. Considering all the technical parameters, buying Dow Jones at the current price might be risky since bearish correction might lead the path soon.Download our latest quarterly market outlookfor our longer-term trade ideas.
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