Hi Traders! Dow Jones short term forecast update and follow up is here. On April 3, 2024 I shared this “Dow Jones Technical Analysis And Short Term Forecast” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Home Trader Club. Spoiler alert – free memberships are available!
My Idea
On the H1 chart, we have a strong bearish momentum and based on the Heikin Ashi candles we can see that currently, we have strong bearish bodies here as well in downward-moving market conditions so it basically reflects a bearish environment. In addition to this, the ADX indicator gave a bearish signal here as well at the cross of -DI (red line) versus +DI (green line) and the main signal line (silver line) reads a value over 25 which we may consider as yet another evidence of bearish pressure. Also, there are no signs opposing this short term bearish view at the moment. So everything looks good here for the bears and until this strong resistance zone (marked in red) shown in the image below holds my short term view remains bearish here and I expect the price to move lower further after pullbacks.
Based on the above-mentioned analysis, on the H1 chart, my short term view was bearish and I was expecting the price to move lower further until the strong resistance zone holds. The price action followed my analysis exactly as I expected it to here. After the strong bearish move, the pullback that I was looking for happened and then moved lower further as I expected it and delivered a wonderful move to downside!
We had facts supporting the bearish view on the M30 chart. After the bearish trend pattern, we had a flat correction in the form of a range and the price which was respecting this range moved lower and broke below the bottom of it. We may consider this as a hint provided by the market supporting the bearish view and also there were no signs opposing this bearish view. The price then moved lower further and provided a wonderful move to the downside as you can see in the image below.
So, traders, this is why I wanted to show this example to help you understand how important it is to follow the facts. The facts were supporting the bearish view here and there were no signs against it. When the facts do happen as we expected you can see how the price perfectly moved as per the plan. Because these are the kind of hints the market provides us at the majority of the time and it’s our obligation as traders to be able to listen to these things that the market tells us and we should try to make the right actions accordingly.
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Happy Trading!
Arvinth Akash
Home Trader Club Team.
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