The agreement signed on Thursday between the United States and China led to a growing euphoric sentiment in the stock markets. This sentiment sent to the Dow Jones Industrial Average to a new all-time high of 28,268 points. This context gives us the possibility that the action of the price will develop a corrective movement in the next sessions.

1. The Dow Jones index in its 4-hour chart shows the development of an expansive triangle pattern. Currently, the price moves in the zone of the upper trendline of this expanding triangle. This context makes us suspect that the price could develop a new bearish movement.

2. A bearish position will activate if the price pierces and closes below 28,081 points. In our conservative scenario, the Industrial Average could see 27,773 points.

3. If the price extends its falls, the index could reach 27,582 points and finally down to 27,396 points.

4. The invalidation level of our bearish scenario is located at 28,303 points.


Trading Plan Summary

  • Entry Level: 28,081 pts.

  • Protective Stop: 28,303 pts.

  • 1st Profit Target: 27,773 pts.

  • 2nd Profit Target: 27,582 pts.

  • 3rd Profit Target: 27,396 pts.




Try Secure Leveraged Trading with EagleFX!

Risk Warning: CFD and Spot Forex trading both come with a high degree of risk. You must be prepared to sustain a total loss of any funds deposited with us, as well as any additional losses, charges, or other costs we incur in recovering any payment from you. Given the possibility of losing more than your entire investment, speculation in certain investments should only be conducted with risk capital funds that if lost will not significantly affect your personal or institution’s financial well-being. Before deciding to trade the products offered by us, you should carefully consider your objectives, financial situation, needs and level of experience. You should also be aware of all the risks associated with trading on margin.

Analysis feed

Latest Forex Analysis

Editors’ Picks

GBP/USD surges toward 1.3150 amid upbeat UK data, USD weakness

GBP/USD has been extending its gains after the British CBI Trends figure beat expectations. Markets are pricing a BOE rate cut less aggressively. The US dollar is on the back foot across the board amid reduced coronavirus fears.


EUR/USD struggles to recover amid Trump's tariff threats

EUR/USD is trading below 1.11, close to the three-week lows, as President Trump continues threatening the EU with car tariffs. Markets remain concerned about the spreading coronavirus disease. 


BoC goes dovish, USD/CAD jumps above 1.31

In a widely expected decision, the Bank of Canada on Wednesday announced that it left its policy rate unchanged at 1.75% at its January policy meeting. In its policy statement, the BoC noted that it sees less risk of an extreme downside scenario related to trade tensions.

Read more

Gold Price Analysis: Intraday uptick falters near 50-hour SMA, remains vulnerable

Gold lacked any firm directional bias and seesawed between tepid gains/minor losses through the mid-European session on Wednesday.

Gold News

USD/JPY rises above 110.00, potential head-and-shoulders on 1H

Risk reset in stocks is boding well for USD/JPY.  The pair may be forming a head-and-shoulders pattern on the hourly chart. The bulls are not out of the woods yet and a break above 110.12 is needed to invalidate lower highs setup on the hourly chart.


Forex Majors