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Dow Jones Repelled by 12-year ‘Insider’ Resistance
By, Simon Maierhofer
Monday December 08, 2014
The Dow Jones has been up for seven consecutive weeks, but this nearby resistance level threatens to break the Dow’s winning streak. Any pullback should result in renewed buying and the Dow may bounce from this support.

18,003.88 looks like an unassuming number, but it has some significance for investors, especially for those holding the Dow Jones SPDR ETF (NYSEArca: DIA).

Although it is close to round number resistance, 18,003.88 is only known to support/resistance connoisseurs.

It is a Dow Jones Fibonacci projection level that goes all the way back to 2002. I mentioned in Sunday’s Profit Radar Report that: “The Dow Jones nearly tagged resistance at 18,004, increasing the chances of a temporary pullback.”

As important as this Fibonacci resistance may be, the weight of evidence suggests only a temporary pullback. The green line shows one possible down side target, but pullbacks in 2013 and 2014 did not always correlate to obvious support/resistance levels.

Long story short, the pullback is likely to morph into a buying opportunity.

Recent Profit Radar Report analysis for the S&P 500 is available here: S&P 500 Suffers from Lack of Participation

Recent Profit Radar Report analysis for the Nasdaq-100 is available here: Nasdaq-100 'Stuck on an Island'

Simon Maierhofer is the publisher of the Profit Radar ReportThe Profit Radar Report presents complex market analysis (S&P 500, Dow Jones, gold, silver, euro and bonds) in an easy format. Technical analysis, sentiment indicators, seasonal patterns and common sense are all wrapped up into two or more easy-to-read weekly updates. All Profit Radar Report recommendations resulted in a 59.51% net gain in 2013.

Follow Simon on Twitter @ iSPYETF to get actionable ETF trade ideas delivered for free.

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