Technical Analysis: US market outlook Dow faces correction upon reaching 32,000? March 1, 2021 349

  • Dow has reached 32,000 target faster than we expected and it had a 600 point drop upon reaching 32,000 based on our report dated 15th Feburary 2021
  • However, prices still remain well intact within the rising wedge.
  • Major tech stocks has turned from strong-buy to strong-sell based on our moving average ratings.

The Dow Jones industrial average has successfully touched based at 32,000 but it did not managed to sustain beyond that. However, it is too early to call for a short confirmation now as prices has yet to break below the rising wedge. Hence, the potential two scenario remain the same based on the report on 15th Feburary 2021.

Hence, the only way to confirm the correction is to break the resistance turned support zone at 29,499-28,892. Otherwise, we remain our outlook to 123.6%-138.2% extension level resistance zone.

The daily chart shows Dow’s slowing of momentum in the actual price chart and the Relative strength index remain flat despite the upside thrust of RSI,  it fails to break the high of the RSI(above 80). As such, the short-term outlook remain shaky and cautious.

Prices should be testing the key resistance turned support zone.

 

 

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About the author

Profile photo of Chua Wei Ren

Chua Wei Ren
Technical Analyst
Phillip Securities Research Pte Ltd

Wei Ren specialises in Technical Analysis and has 11 years of experience in studying classic technical price action. He also study and research extensively on Elliott wave theory, Dow Theory. He believes that history plays an important role in how the market is reflected in the future.

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