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PUBLIC: Why the DOW bounced…IMHO

As many of you know, I like to use technical analysis to augment my Market Alert Signal.  I will post a weekly chart of the DOW to get you familiar wtih the white channel that started in early 2016.  It is directly below:

Note the green circle.  When price hit the channel, the channel rejected the price and propelled it higher.  Will this be the only test of the white channel?  I don’t know…but I’ll be watching it carefully.

Now a daily chart of this same DOW but much closer in time, not a 3 year chart, but a one year chart, starting January 2017.  Note the burst above the channel in October, a test in November, and then whoosh…straight up to the high we just saw in late January 2018.  The white dashed line is the 50-day moving average and “nothing bad happens when price is above a rising 50-day moving average.”  We aren’t back above it, but it is still rising!  Again, we bounced pretty darn close to the white channel line, and we didn’t close a day inside the channel.  THAT is what I’m worried about…closing inside the channel on a weekly basis.