The Dow Jones Industrial Average next pivot point is August 13, 2012. All the other index’s are lining up the same way. The Dow Jones Industrial Average is today’s topic simply because, as Richard Russell puts it, the index indicates from a technical point of view, investors can say one thing being interviewed on tv but the Dow Jones Industrials indicate whether or not the institutional investors put their money where their mouth is. We’ll align the chart patterns with the Swing Trading Forecast Model.
Fridays post I had mentioned that the pivot points remain the same. I want to express my apology by saying things changed a bit, not necessarily from anything I’ve done but it’s the Swing Trading Forecast Model. As time and price get closer to the pivot point date, for whatever reason I can’t explain, the pivot point changes a bit. All of the index’s are aligning too which seems somewhat scary, in a way. Usually when the index’s align and there’s a top or a bottom in place, change is inevitable and that seems to be the way things are shaping up. If your on the long side of the market take extreme care that you don’t get taken for a ride. From a fundamental and contrarian point of view, the market has been going up only on the speculation that there is going to be more money printing. Usually when this happens, the day there’s a fed meeting announcing something, the market gets disappointed and the market falls the day after. Usually there’s no new money on the table until there’s a low in the market. Remember, there are no certainties in the financial markets, only high probabilities. In my opinion, and this is only my opinion based on the facts that I see in the charts below.
The Dow Industrials Monthly Chart above indicates resistance above as well as loosing momentum on the RSI. When you see a diversion like this you pay attention. Not shown in the chart is the fact that volume has been decreasing the whole time as well.
As we zoom in on the Dow Industrials, the weekly chart shows a the same thing as mentioned above. A diversion between a momentum indicator and the price is a powerful indication of a top or a bottom, in the making…in this case a top is forming.
The Daily chart of the Dow Industrials shows you how we are right at the long term resistance line. Could the price break resistance? sure it can…if the price action breaks overhead resistance only to fall back below the long term resistance for any length of time without going above the October 2007 high we could see a break down. In Elliott wave terms…we could be on the brink of wave 3 of 3…remember wave 3 is the longest wave, it’s scary and fast and a wonder to watch. Things seem to be aligning with the Swing Trading Forecast Model.
The chart above is an hourly chart of the Dow Industrials. Same thing again. Diversions at all degrees of time…We’re right up against long term resistance, how much money do you think needs to be printed to put money in the hands of the common person to go and put money in the stock markets world wide in order to make new highs. You know, anything is possible in the financial markets, something always blind sides investors whether a pro or an amateur. In my opinion, and it’s my opinion only based on the technical nature of the charts above, the Dow Jones Industrial Average is setting itself up for the downside, and all of the other index’s have the same look.
One other thing I want to mention is the fact that there is also a diversion between the Dow Industrials and the Dow Transports. I have to admit that I’am not a Dow Theory person but the industrials are rolling over. Talking to some people in the transport business things are slow, maybe coincidence, maybe talking to the wrong people, I don’t think so. I know all of the companies that make up the Dow 30 have more money than what they know what to do with, but if everyone cuts back on spending…these Dow 30 companies are going to need that money they have sitting on the sidelines. Or…the central banks will give everybody in the world a bunch of money and happy days will be here again…who knows…one thing is for sure, the charts tell the story.
These Are the pivot point moving forward, according to my Swing Trading Forecast Model:
- August, 13, 2012
- August 31/September 4, 2012
- September 14, 2012
- September 26, 2012
- November 12, 2012
- December 4, 2012
The December 4th pivot point from the Swing Trading Forecast Model, still seems to point towards a major trend change or break out or break down. That particular date hasn’t budged at all…That’s it for this weekend, I hope the charts of the Dow Jones Industrial Average give you a different perspective versus what you see or hear on mainstream media.