Dow Jones Hits 14,000 Mark

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Dow Jones Hits 14,000 Mark

There was a lot of excitement when Dow Jones index hit 14,000, a new record in the history of its own. Seems like the USA economy stays strong, which is good. However, I have a strange feeling that more news are coming, and not necessarily good ones. I dont want to create mass panic

, but there are some similar traits of the bubble, that has happened in 2000ish.

Anyway, I hope we learned from our mistakes, and if anything happens, we can avoid such a deep dive of the economy we experienced in the beginning of this century.

Let’s look at the recent Dow Jones chart inside 3 month period.

If you’ve noticed, the recent figure shows the Double Bottom pattern. Double bottoms are regarded as reversal patterns, meaning that when they occur, the trend is likely to reverse.

The beginning of the June, 2007 had a down trend, and that Double Bottom shows the change of the trend upwards, and it was supported by the recent 14,000 mark. That looks like a dream come true, and the upwards trend after the Double Bottom looks promising. The charts over longer periods of 6 month and 1 year also show the upward trend, however the 5 day chart shows the hesitating trend which may show the trend change in both directions by the end of this month.

If you are thinking about buying a mutual fund for the long hold position that follows the Dow Jones companies, I would recommend to wait a little bit (at least until the end of July) for the trend to establish - if you buy now and the trend goes down, you may experience asset losses. Keep a close look at the trend behavior in the next days, if it will show the upward trend, it could be a good time to buy ETF funds while the index is lower then before, and make some quick cash on the upward movement.

Relevant articles:

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This entry was posted on Wednesday, July 18th, 2007 and is filed under Opinions. 3,014 Views. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

2 Responses to “Dow Jones Hits 14,000 Mark”

Sephyroth says:
Hi, I’m reading via the Bumpzee US Blogs Community RSS feed.

That’s an interesting outlook on the current situation. I’m not an expert in the markets, but I’ve heard predictions all over the board on where they’re going. I personally think that it will reach 14,000, but 15,000 might be a stretch for this year.

Sephyroth
http://www.sephyroth.net

July 18th, 2007 at 9:04 pm
High Return Investing with Dax says:
Great analysis! I love me some technical analysis. I took some hits and the morning was challenging, but I stuck it through and ended the day with a minor paper loss. Goes to show you, follow analysis unless you have bled too much of course! I believe tomorrow will be a positive day for the market.

July 18th, 2007 at 10:40 pm