lack of economic events and the Thanksgiving holidays in the final part of the
week. The only two important reports were the US Jobless Claims and the US PMIs. The
former beat expectations across the board, while the latter came basically in
line with forecasts. This week we can expect more action with the holidays in
the rear-view mirror and some key economic releases on the agenda.
Dow Jones Technical
Analysis – Daily Timeframe
On the daily chart, we can see that the Dow Jones is
getting closer to the cycle high at 35680 as this November rally just doesn’t
want to let up. The sellers are likely to start looking for a deeper pullback
around these levels, but it’s hard to fight such a strong bullish train without
a catalyst.
We can notice that the price is a bit overstretched
as depicted by the distance from the blue 8 moving average. In such
instances, we can generally see a pullback into the moving average or some
consolidation before the next move.
Dow Jones Technical
Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that
the price has been diverging with
the MACD for
quite some time now. This is generally a sign of weakening momentum often
followed pullbacks or reversals. In this case, it might be a signal that we
could indeed see at least a pullback very soon.
Dow Jones Technical
Analysis – 1 hour Timeframe
On the 1 hour chart, we can see even
better the divergence with the MACD which has been going on since the break
above the key resistance around
the 34000 level. The buyers are likely to continue to lean on the minor trendline and
the red 21 moving average to
target the cycle high. The sellers, on the other hand, will want to see the
price breaking lower to pile in and target first the low around the 34800 level
and upon a further break, the support at 34000.
Upcoming Events
Tomorrow, we have the US Consumer Confidence report. On
Thursday, we will see the latest US Jobless Claims figures and the US PCE
report. On Friday, we conclude the week with the US ISM Manufacturing PMI which
missed expectations by a big margin the last time.
This article was written by FL Contributors at www.forexlive.com.