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Dow30

Dow Transportation is lagging behindDow transportation index (on the left had side) is still trading inside a falling trend line and way below the record high. On the other hand, we have Dow 30 which is just a 100 points away from record high. Note on both the charts, daily RSI is breaking higher from the falling trend. For Dow30 it means, fresh highs are possible. However, for Dow Transportation index, a breakout in the RSI won't help, simply because the index first needs to take out the falling trend line. Investors should watch out for a failure at falling trend line hurdle in Dow transportation index as that would suggest a correction in Dow30 index.
DJ:DJT
by TipTVFinance
Dow30 - Correction never exceeded 38.2% FiboWith US stocks flirting with record highs and charts showing no negative divergence, there is very little to comment on the direction of the stock markets. In today's post we take note of the fact that since bottoming out in 2009, the corrective rallied have not exceeded the 38.2% Fibo retracement. Let us look at the details - 2009 low - 2010 high (blue) - correction ended near 38.2% Fibo 2009 low - 2011 high (black) - correction ended at 38.2% Fibo 2011 low - 2015 high (pink) - correction ended at 38.2% Fibo 2009 low - 2015 high (green) - correction ended around 23.6% Fibo In each of these cases, prices bottomed out at 38.2% Fibo, except in the last case where prices briefly dipped below 23.6% Fibo and quickly recovered. Also note in the first three cases, prices rebounded from 38.2% Fibo and went on to breach the top in the first attempt itself. Only this time (last case) prices have witnessed rebounded twice from 23.6% Fibo, but failed to take out the top. This may be because the correction ended at 23.6% Fibo. Let us see if the index manages to take out 2015 high. Traders should note that a fresh corrective rally could target 23.6% Fibo or 38.2% Fibo. Scope for rebound exists as long as 38.2% Fibo isn't breached on monthly closing basis.
FX:US30
by TipTVFinance
Dow daily outlook Dow’s sell-off from the critical resistance of 18,000 to 50-DMA of 17,743 today suggests correction from June 27 low of 17060 has ended and the index could see sideways to bearish move today. On the downside, doors remain open for a relook at 17,538 (23.6% of Feb low-Apr high). On the higher side, only a daily closing above 18K would indicate a correction from 18k level has ended and the rising trend from June 27 low has resumed. The cyclical high of 17,167 stands exposed in this case.
FX:US30
by TipTVFinance
Will the DJIA hit the year end target?Investing.com provides average year end forecast of 18050 for the DJIA based on the April poll of 25 analysts. How realistic is this target? The DJIA is currently trading at about 19x trailing earnings while the historical average of 15 is about 20% lower at around 14000 range. The market lows of last August and January of 15500 range was around 16.6 x trailing earnings. Analysed from a valuation perspective the DJIA seems overpriced. Technically the chart appears to be range bound with more downside than upside. Another perspective is to consider the lower bond yields around the globe. The stock indexes could warrant a higher than average PE ratio. The earnings yield is the inverse of PE or the Earnings to Price ratio. Barrons reports DJIA earnings of $935 which gives us a current earnings yield of 5.29% and the DIA currently yields 2.48%. Both earnings and dividend yield offers a solid premium over the 10 year treasury yield which is currently around 1.61%. The DJIA is estimated to grow earnings over the next 3-5 years at an annual rate of about 7.8% Whats your thoughts? I look forward to your comments and ideas.
FX:US30
by dime
Dow30-USD/JPY comparisonMajor part of the rally in US stocks since late 2012 appears to have been fuelled by Yen carry trade. Remember Bank of Japan was the first one to fire and the stage was set after Abe came to power. BOJ announced easing in April 2013 and followed it with another surprise in October 2014. BOJ's aggressive actions also forced ECB and other central banks to press the easing button. However, the situation now is Yen is not in mood to weaken, markets are not responding positively to aggressive central bank actions and oil has already doubled from its bottom in February. Moreover, oil helped indices recover from Feb lows even though funding currencies like JPY, EUR were on the rise. Hence, oil better stay resilient other wise, odds of a corrective move in Dow would rise. From technical perspective a break below rising trend line (black) could bring in chart driven bears as well.
FX:US30
by TipTVFinance
Dow outlook – Falling channel at risk of being breachedResistance – 17,758, 17,811 (Apr 1 high), 17,934 (May 10 high) Support – 17,638, 17,539 (23.6% of Feb low-Apr high), 17,418 (May 18 low). Daily chart pattern – Falling channel Sharp rally seen yesterday pushed up RSI back above 50.00. Given the futures are trading 70 points higher, the index is likely to open around 17,758 (channel resistance). Further gains towards 17,811 cannot be ruled out as risk sentiment is likely to stay intact (Greek crisis is out of the way). However, note that Greek deal also means one less hurdle in the way of Fed rate hike. The 2-yr treasury yield is above 0.90% and could near 1% and thus weigh over equity markets. Rejection/Failure to sustain above 17,758 (channel resistance) followed by a break below 17,638 could trigger fresh selling in the markets.
FX:US30
by TipTVFinance
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