Dow Jones Outlook For November 2013




Monday, 18 November 2013

Dow Jones Index, the leading financial index in the US stock market, is one of the most followed indices globally. How about taking a look at how the index is expected to perform this month ? We shall be analyzing the index technically using methods like Gann, Elliott Waves, Wolfe waves and Camarilla Pivots.  Multiple approaches not only give a broader view of the market but also help us take surer decisions as to whether to go long or to go short on a stock or index.

Camarilla Analysis and Wolfe Wave Analysis


Dow Jones Wolfe Wave

Having closed at 15961.7 last week, we can see that the DJIA has just crossed the H3 resistance level of 15842.9. This shall remain the H3 level for the rest of this month and the next Camarilla resistances are H4 and H5 with values 16140.1 and 16690 respectively. Taking a look at the chart, it is revealed that the Dow Jones Index is headed upwards and is likely to touch the next resistance of 16140 in the coming few trading sessions. As per Camarilla theory, this is a bullish zone and could take the Dow further to the H5 level of 16690 also.

Lets take a look at what Wolfe Waves have to say. Considering the same chart once again, we notice that there are no prominent Wolfe Wave patterns. However, since Wolfe lines serve as strong supports and resistances, we can expect some price action accordingly. The green line that joins points 2 and 4 is such a support line and the Dow Jones did bounce from there on the 10th of October 2013. Hence, we may infer that this bullish wave could take the index higher until it touches the red line joining points 1 and 3 which is again a strong resistance. For the time being, hence, the US stock market is bullish.

Elliott Wave Analysis


Dow Jones Elliott Wave

Both the weekly and daily charts for the Dow Jones indicate a fairly bullish pattern. Take a look at both the charts and you will notice that a bullish wave 3 is in progress on the Minor time frame. On the daily chart we also notice that the last bar has just crossed another resistance line near the 15897 level which is again a bullish indication. The next Elliott target would be 16198 on the daily chart.

Dow Jones Elliott WaveWeekly charts too depict a similar picture and we can see that a bullish wave 3 is in the making. 16000 could prove to a natural resistance though.

Gann Analysis


As we mentioned in our earlier post NSE Nifty 50 Outlook For November 2013, the importance of Gann analysis lies in the fact that it gives us a picture of the duration of any trend, here are the probable dates on which the bullish trend on the Dow Jones could reverse :
24th November 2013
1st December 2013
18th December 2013
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