2016-10-10 15:27:17

Review and dynamics
US labor market data for September was not too bad and it did not determine movement direction in the U.S. stock indices. After the publication of data last Friday the indices went down. However, on Monday, the indices have regained almost all losses.

After reaching the new record highs at the level of 18620 in the summer, the index DJIA is declining now; on the daily chart a new downward channel has been formed with the lower limit near the level of 17700.

Since the third week of September the index DJIA is moving in the narrow range between the levels of 18090 and 18380, remaining close to the level of 18280 (ЕМА50 ЕМА200 on the daily and 4-hour charts). It is likely that until the presidential elections on 8 November trading activity in the US stock market will decline. It is likely that trading volumes will be low.

Technical analysis
The index DJIA has consolidated at the support level of 18280 (ЕМА200 on 4-hour and ЕМА50 on the daily charts). This level is crossed by the upper limit of the downward channel on the daily chart.

On 4- hour, daily and weekly charts the indicators OsMA and Stochastic give buy signals; however, the rise above the levels of 18380 and 1843 is not expected.

In general American indices continue positive dynamics. The index DJIA still can go up to the annual highs at the level of 18600.

Positive dynamics will remain as long as the index trades above support level of 17920 (Fibonacci 23.6% to the rise from the level of 15660 after the recovery in February, which followed after the decline in the markets since the beginning of the year and ЕМА200 on the daily chart).

The decline in the index to the support level of 17700 is also possible after the breakout of the levels 17490 (Fibonacci 38.2%) and 17150 (Fibonacci 50.0% and ЕМА200, ЕМА144 on the monthly chart), which will change the existing uptrend in the index DJIA.

Support levels: 18090, 18015, 17920, 17700, 17490, 17380 and 17150.
Resistance levels: 18380, 18435, 18450, 18500 and 18620.

Trading tips
Buy Stop: 18335. Stop-Loss: 18260. Take-Profit: 18380, 18435, 18450, 18500 and 18620.
Sell Stop: 18250. Stop-Loss: 18310. Take-Profit: 18090, 18015, 17920, 17700, 17490, 17380 and 17150.

Indicators give buy signals
Indicators give buy signals

In the short-term the index is in the descending channel
In the short-term the index is in the descending channel