The Big Swing: DJIA Evening Summary 12-6-2018
A Wild Ride on Dow as it Swung as low as 24,242.22 and as high as 24,951.01
Today's DJIA session was the kind that gives an investor whiplash. Tuesday's market close (there was no trading on Wednesday due to President George H.W. Bush's funeral) was 25,027.07. The market opened today with a large gap down and traded as low as 24,242.22 - 784.85 lower than Tuesday's close - before rebounding all the way to 24,947.67, or 79.40 lower for the day.
Despite everything, from the arrest and possible extradition to the US of Huawei's CFO, fears of a wider US-China trade war, an interest rate inversion, and recession fears, the Dow has not yet fundamentally moved from where it was at either the end of October or November. The DJIA sits near the top of a range which began at 10,240 and extends to 28,672 long-term. With a few exceptions over the past few months, the Dow has remained at the 8th and 9th levels of this range. The 8th level ranges from 24,576 to 26,624. The 9th level ranges from 26,624 to 28,672. After topping at 26,951.81 for an all-time high, the Dow has mainly traded within the 8th level, while spending a little time in the 7th level which ranges from 22,528 to 24,576.
There is a fair deal of psychological support for the market near the 24,000 level and the market has not spent a relatively small amount of days trading below 24,000 during all of 2018.
On a monthly basis 25,088 is an important level, as closing below that level for the month would signal the market is turning more bearish. A monthly close above 27,648 would signal that the market could be getting ready to continue moving higher to the next higher leg of market price expansion.
For now though, the market waits for a definitive price signal to indicate which direction things are heading.