Storm winds stir Wall Street and push American stock markets into the abyss. When we were writing last week Pay close attention to Wall Street, the stagnation of US stock markets is a prelude to a strong directional move we had been easy prophets. In that report, in fact, we had highlighted how the inability to exceed the level in the 35.425 area could herald a bearish reversal.
The week has been all down, but the hopes of the bulls are not entirely undone. We will deal with this in the next sections. For the moment, let’s just observe that the forecast fractal, obtained by combining 150 years of history, foresees a decline for the next few weeks.
Storm winds stir Wall Street and push American stock markets towards the abyss: the indications of graphic analysis
The Dow Jones (DJ30) closed the session on 10 September at 34,607.72, down by 0.78% compared to the previous session. The week-over-week change was down 2.15%.
Daily time frame
The four sessions of the week, remember that on Monday 6 September the American stock exchange was closed for Labor day, they were all down. The prices, therefore, moved away from the resistance in the 35.425 area, moving towards the first price target in the 34.570 area.
The first sessions next week, therefore, will be decisive for understanding what will happen in the following ones. The breakout of 34.570 area could cause further bearish acceleration with target in 33.630 area (price target II). The maximum bearish extension, then, is in the 32.685 area.
The holding of the support in the 34.570 area, on the other hand, could favor the restart of the prices which would turn into a bullish reversal in the cso of daily closings above 35.150.
Weekly time frame
On this time frame, things are looking very bad. First of all, we note how the Swing Indicator has given a bearish signal after that of June 2020. Reminding us of what happened at the time we can say that if the bulls regain control they would do so immediately with an explosive upward candle. Surely the upside could resume in the event of a weekly close above 34.940. In this case, the prices would again aim for the III price target in the 37,040 area. On this level, then, we should expect some profit taking.
On the downside, however, the closest target is in the 33,790 area. A weekly close below this level would open the door on reaching the area of 32,000, first, and 30,170, then.
