In this analysis, I'm examining the Dow Jones Industrial Average (DJIA) through the lens of Elliott Wave Theory, which is showcased on the 2-hour time frame. My focus is on identifying the possible completion of a five-wave impulse sequence, followed by a corrective ABC pattern.
Looking at the chart, I've labeled the impulse wave starting from the left of the screen, with waves (1) through (5) following the classic Elliott Wave structure. Following the completion of wave (5), we see an initial sharp decline, which I've labeled as wave (a) of the corrective phase, then a retracement back up for wave (b).
Currently, it seems that wave (c) is unfolding. I've projected its potential path using Fibonacci extensions, specifically targeting the 1.0 and 1.618 Fib levels. These levels are marked at 37935.72 and 37384.62, respectively. I’m closely monitoring these levels as potential support zones where wave (c) could find its footing.
The dotted blue line descending from wave (b) represents my anticipated path for wave (c). This projection is not set in stone, as market conditions can change rapidly, but it serves as a roadmap for my trading strategy. If wave (c) does indeed follow this trajectory and reaches the 1.618 Fib level, I will be on the lookout for bullish reversal signals before considering a long position.
As always, I'll be keeping my risk management strategy at the forefront of my trading decisions, and I recommend everyone do the same. It's important to note that while Elliott Wave Theory provides a structured way to interpret market cycles, it’s one of many tools in a trader’s arsenal, and should be used in conjunction with other forms of analysis and indicators. Let's keep an eye on how the DJIA behaves around these critical levels and adapt our strategy accordingly. Happy trading!
Looking at the chart, I've labeled the impulse wave starting from the left of the screen, with waves (1) through (5) following the classic Elliott Wave structure. Following the completion of wave (5), we see an initial sharp decline, which I've labeled as wave (a) of the corrective phase, then a retracement back up for wave (b).
Currently, it seems that wave (c) is unfolding. I've projected its potential path using Fibonacci extensions, specifically targeting the 1.0 and 1.618 Fib levels. These levels are marked at 37935.72 and 37384.62, respectively. I’m closely monitoring these levels as potential support zones where wave (c) could find its footing.
The dotted blue line descending from wave (b) represents my anticipated path for wave (c). This projection is not set in stone, as market conditions can change rapidly, but it serves as a roadmap for my trading strategy. If wave (c) does indeed follow this trajectory and reaches the 1.618 Fib level, I will be on the lookout for bullish reversal signals before considering a long position.
As always, I'll be keeping my risk management strategy at the forefront of my trading decisions, and I recommend everyone do the same. It's important to note that while Elliott Wave Theory provides a structured way to interpret market cycles, it’s one of many tools in a trader’s arsenal, and should be used in conjunction with other forms of analysis and indicators. Let's keep an eye on how the DJIA behaves around these critical levels and adapt our strategy accordingly. Happy trading!
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