DOW DOWN NOW ? 26K before 2024? Good Day to the warriors of WALL ST,
I believe the bottom of CURRENCYCOM:US30 is not in yet. However, I believe we are possibly nearing the top of 2023.
Below I will explain the reasoning behind my analysis.
1. JAN 6, 2022 - Feb 24, 2022
As we began the year of 2022 we started to see the massive post covid bull rally & injected liquidity come to an end as the FEDS printer stopped working.
This resulted in a 12.5% decline from record highs just shy of 37K while Americans believed inflation was transitory.
From FEB 24th lows we rallied for 10% and of course price went just above the yellow trendline right before the other massive drop.
2. APR 21, 2022 - JUN 17, 2022
Inflation clearly was not transitory. Which led the FED to begin using its "tools" increasing interest rates.
Inflation is clearly an issue now besides all other global economic tensions which leads to more downside, for a 16.5% drop.
From JUN 17th lows we rallied for 15.5% {+5.5% of our previous 10% rally} once again just above the purple trendline now and then boom another drop.
3. AUG 16, 2022 - OCT 3, 2022
Hopes for a slowdown on rate hike begins to fade and WALL ST. panics which gave us a new low for 2022 below 29K.
The amount of short volume was insane during this time which is why I believe we saw a big rally for the last quarter of 2022.
From OCT 3rd lows we rallied 22% {+6.5% of our previous 15.5% rally} .
NOW, all of this brings us to the present which may not be a gift to all.
The blue trendline has been taken out just like our previous yellow & purple trendlines before a decline.
CPI report gave us this rally along with hopes of 25bps increase instead of 50bps.
I feel like the CURRENCYCOM:US30 is on a tightrope at the moment with more downside to come.
We shall see, GOD BLESS AMERICA BABY !
