US stock Market: Exceptionally Bearish

This week we bring you a simple update on US markets.


Weekly Dow Chart

The dominant feature of the DOW is the head and shoulder pattern and the neckline. The lower levels of the head and shoulder pattern have been achieved. Now the DOW is using the slope of the neckline as a resistance level. This is exceptionally bearish. The next historical support is at 10000. This has been broken, but we need to see a weekly close below this level before we can say support has failed. Support below this level is at 9300. Resistance for any rebound is provided first by the sloping neckline and then by the long term up sloping trend line.


Weekly S&P500 Chart

The dominant feature on the S&P 500 is the rounding top. The pattern target hangs in mid air near 1190. The nearest lower support level at 1160 has proved ineffective. The long term support target is near 1060. This has been broken, but we need to see a weekly close below this level before we can say support has failed. The next support level is near 960. The key feature is the ability of any rebound to move above the downtrend line.



Weekly NASDAQ Chart

The NASDAQ is a real concern because it has provided leadership for the US market. Both the S&P and DOW have followed developments in the NASDAQ. The NASDAQ achieved the head and shoulder targets in March. The fall below 2200 has not been arrested by support at 2020. This is particularly bearish. It suggests that further falls are possible, with a long term support level near 1850. This has been broken, but we need to see a weekly close below this level before we can say support has failed. Next support level is 1320. NASDAQ leadership confirms the lower targets for both the S&P and DOW.

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Article contributed by Private Trader, Market Expert, Trading Coach and Best-Selling Author Mr. Daryl Guppy. For more articles and commentaries from Daryl Guppy, click HERE.