DJI 90 year-old Dow Jones index hints at correctionGlobally, Dow Jones industrial index has been on the growth for almost 90 years since the Great Depression.
Ironically, World War II launched an industrial boom in the United States that pushed the index up.
It took 30 years and increase in 10 times of the DJI value before a more or less significant correction took place in 1973 , and the oil crisis can be called the main driver.
The next corrections came again 30 years later: the crash of the Dotcoms of the 00s and the financial crisis of 2008-2009 , which should already be in the minds of most readers.
And now, not a simple 2020, closed with the Japanese candle "hanging man" , which can be regarded as the first bearish signal.
The collapse of the index in the spring 2020 through the first wave of coronavirus, and then its rapid growth amid subsidies to the population and the economy, formed a large shadow under the body of the candle.
How long will the economy be supported by the US printing press, will vaccination have an effect, or maybe something else will happen, we do not know...
But according to candle analysis, if the next candle behind the Hangman opens lower , then many traders may want to consider selling.
It's very interesting how the trades will open in 2021!
You will say that journalists refer more to the DJI index , and traders are guided by the S&P 500 (by the way, Tesla shares were added to the index a week ago) and you will probably be right. The Dow index has been calculated since the 19th century and is historically very important, but in 1957 appeared a competitor S&P 500.
All the same, the S&P 500 index, which includes the value of shares of 500 companies, more realistically shows the mood of the modern market than the Dow Jones industrial index, which includes only 30 companies.
We have added the S&P 500 to the chart below and what do we see? Another "hanging man" or Hangman.
By the way, it's not bad enough, historically they work out Fibo levels on the indices , everyone can find something that he likes.
Write in the comments, your expectations for 2021
