Dow Jones Industrial Average (.DJI) biggest December loss since the Great Depression
Few people on Wall Street remember the last time the stock market had this tough of a December. That’s because the Dow and S&P 500 are currently on track for their biggest December loss since the Great Depression.
The Dow and S&P 500 were each down about 7.8% through Monday. That’s the largest drop for each key market barometer since 1931, according to data from LPL Research. But those Depression-era losses were much bigger: the S&P 500 plunged 14.5% while the Dow plunged 17%.
Still, the December 2018 swoon is making investors nervous that earnings growth may have peaked this year. They’re worried that the economy could slow in 2019 because of continued trade tensions with China and rate hikes by the Federal Reserve.
The Dow and S&P 500 are both in the red for the year, putting stocks on track to have their worst annual loss since the 2008 Great Recession — and first annual loss since 2015.
December is usually a very solid month for the market. Professional money managers tend to buy top-performing stocks to make their portfolios look good — a phenomenon known as window dressing.
Overall, the bias in prices is: Downwards
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 25,087.66.
The projected upper bound is: 24,651.21.
The projected lower bound is: 22,589.21.
The projected closing price is: 23,620.21.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 15.5567. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 9 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 34.24. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 36 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -133.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 9 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 6 period(s) ago.
Rex Takasugi – TD Profile
DJ INDU AVERAGE closed up 82.660 at 23,675.641. Volume was 26% above average (neutral) and Bollinger Bands were 47% wider than normal.
Open High Low Close Volume___
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 24,365.10 25,111.93 25,075.79
Volatility: 25 26 19
Volume: 395,752,640 372,257,824 332,760,672
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
DJ INDU AVERAGE is currently 5.6% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .DJI at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .DJI and have had this outlook for the last 5 periods.