Trading plan for Dow Jones for December 31, 2020

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Technical outlook:

Dow Jones has managed to print yet another high over the 30600 mark before pulling back lower. The index is seen to be trading (futures) around the 30435 levels at this point of writing and is expected to continue drifting lower from here towards the 29000 and 26000 levels respectively.

Immediate resistance zone is at 30650/700 while support is found towards the 29400/500 levels respectively. Please note that Dow Jones has managed to produce an uptrend since March 2020 lows around the 18200 levels. The index has been in control of bulls and managed to carve a series of higher lows and higher highs towards the 30600 levels recently.

The above trend looks mature and might be preparing for a meaningful corrective drop towards the 23000 levels in the next several weeks. A breakout below 26000 will confirm that a much deeper correction is on its way towards the 23000 levels, which is also the fibonacci 0.618 retracement of the entire rally between the 18200 and 30600 levels respectively.

Trading plan:

Remain short against 31000, targeting at 26000 and 23000.

Good luck!

The material has been provided by InstaForex Company - www.instaforex.com