Dow Jones 30 Forecast August 11, 2015, Technical Analysis

The Dow Jones broke the top of the hammer from Friday during the Monday session, and shot straight up. Because of this, it appears this market is ready to go much higher, given enough time. We have no interest in selling this market now, because of the strength that was shown during the day on Monday. The fact that we bounce so hard suggests that people are starting to buy value, and they recognize that the market should continue to go much higher over the longer term. The 17,800 level above is resistive, but quite frankly we feel that’s going to be more or less a “speed bump” on the way to higher levels. With this, we believe that the market will eventually break out above there and head towards the 18,150 level after that.

We believe pullbacks will continue to be buying opportunities, and with that the market should be somewhat bullish but choppy. After all, there is a lot of noise between here and the 18,150 level, so having said that it is likely that you will have to practice some patience in order to hang on to any trades to the upside. Nonetheless though, there’s no way we can sell this market as it does appear that we have put a bit of a bottom in here over the last couple of sessions.

That does it mean that this is going to be easy, you will simply have to look at this more or less as a longer-term trade regardless of what you are trying to accomplish. This is the wrong time year to expect any explosive move anyway, but at this point in time it’s only a few weeks away from seeing quite a bit more liquidity flow into the marketplace. This is vacation season, so a lot of the “large money firms” are trading very little at the moment. With this, we believe that eventually this will be very bullish but smaller positions should be used in the meantime as you will probably have to hang onto a lot of back and forth action.