Dow Jones faces negative pressure. - technical analysis - 18-12-2015

Dow Jones Industrial Average gave up ground in the short term and intra-day levels, following the forming of a negative divergence on the Stochastic indicator as shown below the attached chart, which led the index to break through the simple moving average for the period 50, doubling the negative pressure on the its movements. The index's thereafter breached the important support level of 17,408, which represents the ratio 23.6% of Fibonacci retracement levels for an ascending wave in the medium term (from 15,799 to 17,905).

 

We therefore expect more losses for the index, especially if the breach of the 17,408 support was reinforced, targeting thereafter the support of 17,101, which represents the ratio 38.2% of the same retracement levels.