Dow Jones might have carved a meaningful top around 35104 levels on May 10, 2021. The indice has held on to its highs since then and prices have reversed lower from 35097 levels over the last week. This could be the beginning of a potential bearish trend.
Dow Jones has not registered fresh highs since May 10, 2021 unlike its counterparts SPX500 and NASDAQ. Please note that this phenomenon can also be interpreted as a bearish divergence having potential of a trend reversal ahead.
Looking into the earlier wave structure, Dow Jones has managed to carve Wave 5 at 35104 levels at a multiple degree. If correct, the corrective drop from here is also going to be of an equal degree hence the indice could drop lower than expected.
A minimum drop could be until its March 2020 lows around 18200 levels respectively. The implications and depth of the corrective wave could be much deeper as the year progresses. It might not be the time to buy stocks at this point in time.
Looking at the recent wave structure, Dow Jones might have already carved lower degree waves I and ii around 33747 and 34625 levels respectively. If correct, Wave iii of (iii) might be in progress soon dragging prices towards 32900 going forward.
The Profinacademy.com Team
Bitcoin dropped close to $46000 mark on Monday before finding support again. The crypto is seen to be trading around $46500 mark at the time of writing as bulls remain inclined to be back in control.
The US dollar index spiked through 96.85 mark on Wednesday on the back of the Federal Reserve interest rate decision.
EURUSD is finding support from its consolidation lower range around 1.1260-70 and could resume its rally from here soon.