Weekly Research Report Vol. 6 : Global Markets

HIGHLIGHTS:

Dow Jones Industrials hits key 25,000 price level, with its eye on both 27,500 and 29,400.

US Dollar Index signals a long-term bear market, but for the short-term it may experience a counter-trend rally.

Inversely, commodities (CRB) have had a spectacular bull run, but now point to a short-term pullback to 440.

Oil has risen to anticipate geometric resistance of $61.79 its cumulative average, but may pull back to the $54 – $55 price area in the near-term.

Bitcoin is indicating a continuation of the larger bull run, as expected, with $24,920 as the potential next top.

DOW JONES INDUSTRIALS (DJI)

DJI reaches key pivot of 25,000.

Watch for reaction from the 25,000 price zone for next direction, either continuation of uptrend in the near-term or interim retracement prior to larger bull trend continuation.

(This analysis is a follow-up to the identification of 25,000 as the next major resistance area in our September 25, 2017 article.)

The Dow’s triumphant rise to 25,000, which was reached last week, marks the next phase of activity, as per this enhanced and updated chart outlining master support and resistance:

DOW M 100K COLORED SECTIONS.png

Note the dramatic difference in market movement between the blue and red shaded areas.

Just as it did previously at point A, the Dow is now entering the next large correction area (point B), invoking concerns of an eventual large bear market. However, it has quite a way to go before the upper levels of this area become a realistic concern (33,400 to 36,000).

The prior price movement from point A to the tops of 1998 and 2000 and their respective drops back down to support are carried forward to the current market (blue and red lines/arrows). A perfect repeat would yield the indicated movements.

Naturally, if the market does not maintain prices above 25,000, support is expected at prior resistance of 22,400, as discussed in the September 2017 article.

Keeping in mind that 27,500 is the next higher resistance level, we move on to an entirely different analysis approach, yet yielding eerily similar results. By using square numbers x1000 as support and resistance levels (more importantly, the space between the levels, as divided fractionally) a major market movement seems to be repeating here as well:

DOW M SQ LEVELS x1000 PATTERN 5THS MOVES.png

The relationship of major lows of March 2009 at 6,469.95 (A2) and October 2011 at 10,404.49 (B2) are a perfect repeat of the two proceeding important lows of December 1974 at 570.01 (A1) and October 1998 at 1,616.20 (B1). These two sets of lows occur at a 1/2 level followed by a 1/5 level in the next range, but are two full ranges apart from each other.