DOW update: last week’s predicted $17,050 target almost reached on Wednesday. What’s next!?

Last weeks free update (see here) showed 6 (!) lines of evidence pointing towards a low at DOW $17,050 (support, 50% retrace of the October 2014 low to ATH, an ending diagonal pattern, intermediate, minor and minute wave Fib-extensions). On Wednesday the DOW bottomed at $17,125, off by only 75p (0.4%): not a shabby prediction dare I say**, and rallied almost 300 points. In addition to these facts, there’s now also a 7th one: at $17,125 (orange) micro c equals micro a (of minute c).

dow dailyCLICK CHART TO ENLARGE. On Friday price moved outside the falling wedge pattern as well as back inside the (yellow) uptrend channel in place since the important price low made in 2011. It also found support at the 2nd blue S/R level and 38.2% retrace (of the move from the October 2014 low to the March 2015 ATH: the blue III); $17,350, and $17,375, respectively. For the bulls, price now needs to remain inside the uptrend channel and move above the first S/R level at $17,575. After that the 23.6% retrace is on tap (red a). For the bears, price needs to fall back below the 2nd blue S/R level and 38.2% retrace for more downside, further subdividing the c-wave. However, in this week’s digest for premium members only objective factual weight of observable evidence was used to determine the markets next most likely direction***.

**FYI: In last week’s digest for premium members only I outlined that “…based on the DOW I prefer the SPX will bounce to around 2100 (S becomes R, and right in between the two ascending yellow trendlines [off the 2114 high] ) and then drop down to SPX 2040s…”.This came, obviously, to fruit with a rally to SPX 2104 and then a drop down to SPX 2052. Off by 4p and 7p, respectively.

***The 1 month free trial period special has been extended through August. You can cancel at any time during the trail period at not cost. Please sign up here

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