2016-11-04 11:45:09

Review and dynamics
Uncertainty about the outcome of the presidential election in the US agitates financial markets, forcing investors to turn to safer assets, such as the Yen, precious metals and the Franc. The US stock markets and the USD are under pressure.
After reaching the new record highs at the level of 18620 in the summer, the index DJIA has been declining. Since the beginning of the month in less than 4 days the index dropped by 1.3% or 230 points.
At the opening of today's trading traders’ activity in the US stock markets is declining. The US stock indices are traded in the very narrow range.

Our opinion
Today, the index DJIA is at the strong support level of 17920 (Fibonacci 23.6% to the rise in the wave from the level of 15660 after the recovery this February, from the decline in the markets since the beginning of the year). Moving average line with the period 200 is also at this level on the daily chart. It will be difficult for the price to breakthrough this level.
The next week the price may experience strong fluctuations near this level, and in the range of 18040 (ЕМА1444 on the daily chart), 17920 and 17850 (ЕМА50 on the weekly chart).
The lower line of the ascending channel on the daily chart with the upper limit near the level of 18520 is between these levels.

However, we cannot predict the outcome of the voting and therefore movement direction in the financial markets is also unpredictable. Note that many brokers have already notified their clients about the reduction of the level of leverage and possible of the decrease in liquidity.

Fundamental factors will have a great impact on the stock indexes and possibility of the monetary policy tightening is a strong factor causing the decline in the U.S. stock market.

Today US labor market data will become known at 15:30 GMT+3).
It is useless to predict movement direction in the USD and the US stock indices in the period after the publication.
The movement may go to either direction.
In the case of breakdown of the level of 17290 the price may continue to decline. Consolidation below the level of 17490 (Fibonacci 38.2, ЕМА200 on the weekly chart) can trigger downtrend in the index DJIA.

On 4- hour, daily and weekly charts the indicators OsMA and Stochastic show that the decline in the index will continue. On the monthly chart the indicators also give signals for short positions.
As an alternative scenario the index can consolidate above the level of 18040, and start to grow up to resistance levels of 18280 and 18375. Breakout of these levels may trigger further rise to the annual highs at the level of 18620.

Support levels: 17920, 17850, 17700, 17490, 17380 and 17150.
Resistance levels: 18040, 18280, 18375, 18435, 18450, 18500 and 18620.


Trading tips
Buy Stop: 17965. Stop-Loss: 17910. Take-Profit: 18040, 18280, 18375, 18435, 18450, 18500 and 18620.
Sell on the market. Stop-Loss: 17960. Take-Profit: 17850, 17700, 17490, 17380 and 17150.

DJIA: the price is at the level of 17920. Technical analysis for 04/11/2016
At support level of 17920

DJIA: the price is at the level of 17920. Technical analysis for 04/11/2016
Indicators give sell signals