A silver lining amongst all the negativity A relative comparison between the DJI, JNK & DJT is showing some underlying strength building in the market. This is also known as a "risk on" sentiment and that's when high risk assets do very well
Dowtransports
DJT,a leading economic indicator,again topping out bef SPX w H&SSomething is wrong! NOWHERE to hide except cash. Even XLP staples crash last week.
Now DJT is showing yet another warning sign. It just broke the very crucial 14k support, completing a head & shoulder pattern. Measured move may send it down to the 11k to 10300 zone.
It is now at 13500 my green pivot box where the red dotted median of my PITCHFORK is located.
If 14k is not reclaimed next few days, I think DJT may be making a 5 waves further down to 12300 where the black VWAP from the pandemic low will intersect. After that it will make a counter trend wave 4 rally back to retest 14k (wave 4 should not cross wave 1) before the final wave 5 dump to my yellow 11k to 10300 zone.
Last time DJT topped-out on 17Sept2018, 16 months before SPX’s peak on 13Jan2020. This time DJT peaked on 2Nov2021. This scenario suggest that recession is already underway & we just dont see it yet, especially if SPX gets rejected again at 4100/4200 again after this week’s expected oversold rally & breaks below 3800. Worst scenario may see SPX further down at 3520 or even 3200.
This time may be different coz we are in uncharted territory with so many headwinds like rising inflation, FED doing whatever it takes to raise interest rates to fight inflation, the invasion & the energy & food crisis it created & also the China lockdown. This time there will be no stimulus & no FED saving the stock market.
Not trading advice. Minimize risks & trade with CAUTION!
DJT:bellwether for stocks & economy just sliced thru 14k supportThis is bad! Stocks are falling even when DXY dollar index & TNX 10-yr yield are retracing.
The Dow Jones Transportation, a leading indicator for the stock mkt & the economy, just
zipped through the 14k key support, down 7.41%. All stock indices had a capitulation-like move Wednesday 18May, the worst since the pandemic days. Even defensive staples, household retailers like Target & Walmart fell.
DTJ has fallen into my green support zone. It may fall further it does not recover 14k soon.
Not trading advice
Will The Fed Save The Dow?The Down has gapped below the previous low completing the Dow sell signal I posted about compared to the Dow Transport. Rsi and Stoch Rsi are nearing buy signals though plus the Dow broke down from the falling wedge. I am hedged short but I am not calling a full on crash/top given the Fed's track record. If the Fed didn't always save the market I would go short with a lot more conviction.
Going to be interesting to see what happens with the options expiration today.. Most times people are warning of option expiration nothing happens.. lets see if this time is different. Eyes on the VIX too.
Airlines lagged as Dow Transports move upFEDEX and UPS have moved up alot in recent days along with some other dow transports. Airlines have lagged behind with no bids. This week, look for Airlines to move out of oversold conditions to move Dow higher. News will break out as passengers return to flying domestically. Volume will pick up accordingly. Breach 46.70 with volume, look out 52!
DTX - downtrend to levels below 650DTX is tracing the early stages of primary wave 3 down that should push pri es to levels below 650. If price crosses up 872 this analysis should be reviewed. FOLLOW SKYLINEPRO TO GET UPDATES.
𝗧𝗿𝗮𝗻𝘀𝗽𝗼𝗿𝘁𝘀 𝗨𝗽𝗱𝗮𝘁𝗲: $DJT Daily. Breaking Down200dma broke as has the 2019 uptrend. Huge red flag for markets. May DCB here near 10K
