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Dow Jones Industrial Average IndexDow Jones Industrial Average IndexDow Jones Industrial Average Index

Dow Jones Industrial Average Index

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Signs of Exhaustion in DJI The above chart is that of daily timeframe of DJI. We can see that the index has been following a long term support trendline from which it has taken support 5 times. This shows that the support may be weak now and it will be easier for sellers to break the support if the index moves any closer to the support. In addition, we can see that the RSI is flat to negative even when the index is making higher highs and higher lows. This signifies that even though the index is moving up it is not being supported by good buying strength. The index thus is showing signs of exhaustion. Thus the index may either consolidate at these levels or breakdown below the support trendline. Only when the index moves higher and considerably away from the support trendline supported by healthy RSI, one should go long. What should we do? If the stock consolidates for a considerable amount of time, and breaks out then only we should go for buying. Otherwise we should look for selling since it looks like a good selling opportunity. This is not a recommendation. It is a simple analysis employing only trendline and RSI Indicators. The index may not perform as predicted.
DJ:DJIShort
by tksthathachari
2