the DOW does paint a more bearish picture than the S&P 500, First, because price broke below the red uptrend channel, in place since 2013, and the last time this happened was February this year. There are two lower levels of support: ~$17,750, and around $17,600 (1st and 2nd set of two blue horizontal S/R lines). Below is a whole lot of vacuum to ~$17,250 and ~$17,050. IF price drops that low, we’re by then talking of a 7+% correction, and something more bearish is IMHO afoot.
Please also note that price is in a downtrend channel since the May 20 price high, grey trend channel, and on Friday support became resistance (upper blue horizontal line). The orange ascending trend line is a parallels line to the red trend line, and it shows there’s confluence with the ~$17,500 level (orange arrow) and in the time-price-path of the grey descending trend channel. Something to keep an eye on.
The TIs on the DOW are also pointing down, but are now in oversold territory (RSI5 and FSTO) or getting there (MACD). Note that the -40 and -100 levels on the MACD coincided with important market bottoms over the past 6 months (blue horizontal and green vertical lines). With the MACD now at -25 it is getting close. However, none of the TIs show a sign of turning or of positive divergence yet and thus like to see lower prices. Price did find support at the 150d SMA, but if that doesn’t hold then the daily S1 at $17,712 is the next level which coincides well with the aformentioned ~$17,750 level. Below that is the 200d SMA, $17,608, which coincides well with the aforementioned ~$17,650 level. The latter gives a ~4% correction (~$2045 on the SPX) and means an alternative count is forming: an irregular flat (black ABC’s), targeting the 200d SMA (at ~$2045on the SPX): orange circle. That would then finalize minor 2 of intermediate iii. By then the daily MACD will surely be at the -100 level: buy baby buy!?
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