Dow Jones 30 forecast for the week of November 16, 2015, Technical Analysis

The Dow Jones 30 fell rather significantly during the course of the week, testing the 17,250 level. This area has been supportive in the past, and as a result it does not surprise us at all that we couldn’t continue to go lower. Even if we do break down from here, we are going to step to the side and wait for supportive candle in order to start going long. Ultimately, this market should then reach towards the highs again, but it could be a bit of a fight. Even though this weekly candle has been rather negative, the reality is that we have seen a massive move higher recently, and the pullback is just simply something that needed in order to continue to increase the price of this index. After all, the momentum was a bit too strong, and having said that it makes a lot of sense that the buyers had to take a bit of a break. Nonetheless, we think that this market does go higher and we are simply waiting for some type of supportive candle in order to continue going much higher.

The 18,300 level was the recent high, and we believe that the market is heading in that general direction given enough time. If we can break above there, the market should then reach to the 20,000 level, which is our longer-term target, but we recognize that may not be hit until later in 2016.

There is a massive amount of support at various levels below, as well as the fact that the US economy is stronger than all of the other large ones should continue to push this market higher. After all, the jobs number recently was much stronger than anticipated, and as a result it would make sense that a lot of traders around the world are putting money into the US as it is one of the few places that we should see growth, which of course will attract longer-term investors. With this, it’s only a matter of time before sharpening money back to work here.