Category DOW

DOW Jones facing weak Ichioku support

dow-jones-on-ichimoku-support-bearish

As previously highlighted that the DOW Jones Transport index has indicate a possible bearish trend developing

Yesterday’s DOW Jones closing low and just above a very thin Ichimoku support suggests that the support level may not hold.

On top of that, the leading Ichimoku kumo support is thin as well.

The chances of the index turning bearish is getting higher.

 

When Dow Jones Transport confirms the bear trend

Just a couple of days ago, Dow Jones index hits new high.

dow-jones-index-20150528

Yet, underlying this bullish trend, a disturbing divergent can be found in the Dow Jones Transport.

On the Down Jones index chart above, we can see that the kumo support is so thin, that suggests that support is very weak. And the slightest news will most likely see it goes below 17700.

We can see from the Ichimoku chart that Down Jones Transport has instead turns bearish, trading below the kumo.

dow-jones-transport-20150528

Dow Jones Transport has failed to breakout above 13794 for 4 times since November 2014. With the latest high in March, it has since turns bearish and support level does not seems to hold.

It is likely that the Dow Jones index will follow through and turn soon. After all, if demand for transport is not growing, are manufactured goods being move across the supply chains? Where is the demands for finished goods?

 

 

Trading Ichimoku Trend Table : June 2

Here’s my reading of the various indices based on Ichimoku

Trend DOW Jones (DJIA) S&P 500 (SPX) NASDAQ (COMPQ) Russell 2000 (RUT)
Long Term (Kumo) Down Down Down Down
Intermediate (Kijun Sen) Down Down Down Down
Short Term (Tenkan Sen) Up Up Up Up

Notes:

1. If price level is above kumo, it is considered UP or bullish and vice versa.

2. If price level is above Kijun sen (the trend line), it is considered UP or bullish and vice versa

3. If price level is above Tenkan sen, it is considered UP or bullish and vice versa.