HOT TOPICS LIST
- MACD
- Fibonacci
- RSI
- Gann
- ADXR
- Stochastics
- Volume
- Triangles
- Futures
- Cycles
- Volatility
- ZIGZAG
- MESA
- Retracement
- Aroon
INDICATORS LIST
LIST OF TOPICS
PRINT THIS ARTICLE
by Arthur Hill
The Dow Utilities have performed well over the past year, but the average is meeting resistance near a key retracement point with a potentially bearish pattern emerging.
Position: N/A
Arthur Hill
Arthur Hill is currently editor of TDTrader.com, a website specializing in trading strategies, sector/industry specific breadth stats and overall technical analysis. He passed the Society of Technical Analysts (STA London) diploma exam with distinction is a Certified Financial Technician (CFTe). Prior to TD Trader, he was the Chief Technical Analyst for Stockcharts.com and the main contributor to the ChartSchool.
PRINT THIS ARTICLE
FIBONACCI
Dow Utilities Consolidation At Key Retracement
10/31/03 09:09:04 AMby Arthur Hill
The Dow Utilities have performed well over the past year, but the average is meeting resistance near a key retracement point with a potentially bearish pattern emerging.
Position: N/A
| The trend on the weekly chart remains up, but the advance reached a classic retracement level as well as resistance from a prior high. The advance from 162.52 to 257 retraced 62% of the prior decline (313.25 to 162.52). |
| 313.25 -162.52 =150.73 150.73 x .62 = 93.45 162.52 + 93.45 = 255.97 |
|
| Graphic provided by: MetaStock. |
| |
| Sharp declines often give way to corrective advances that recoup a portion of the prior decline. In Elliott terms, this decline would be considered an impulse wave, while the advance would be considered a corrective wave. The Fibonacci numbers .382 (38%) and .618 (62%) are typical for retracements and are also popular among Elliott Wave theorists. |
| In addition to the 62% retracement, resistance at 257 is confirmed by the August 2002 reaction high (red arrow). Including the early October high, there have been three attempts to break above this resistance level. The latest attempt has yet to fail, but volume during September and October was below average (blue arrow). This makes the latest rally from 230 to 256 suspect and open to failure. |
| The advance over the past year looks like a rising wedge. These are typically bearish patterns that form as corrective advances. As long as the lower trendline holds, it is wise to respect the bears. A move below the lower trendline would signal a continuation lower and open the door to at least a support test around 230. A support break at 230 forges a lower low and turns the weekly trend bearish. |
Arthur Hill is currently editor of TDTrader.com, a website specializing in trading strategies, sector/industry specific breadth stats and overall technical analysis. He passed the Society of Technical Analysts (STA London) diploma exam with distinction is a Certified Financial Technician (CFTe). Prior to TD Trader, he was the Chief Technical Analyst for Stockcharts.com and the main contributor to the ChartSchool.
| Title: | Editor |
| Company: | TDTrader.com |
| Address: | Willem Geetsstraat 17 |
| Mechelen, B2800 | |
| Phone # for sales: | 3215345465 |
| Website: | www.tdtrader.com |
| E-mail address: | arthurh@tdtrader.com |
Traders' Resource Links | |
| TDTrader.com has not added any product or service information to TRADERS' RESOURCE. | |
Click here for more information about our publications!
Comments
Date: 11/06/03Rank: 3Comment:
Date: 11/07/03Rank: 4Comment:
|
Request Information From Our Sponsors
- VectorVest, Inc.
- Executive Premier Workshop
- One-Day Options Course
- OptionsPro
- Retirement Income Workshop
- Sure-Fire Trading Systems (VectorVest, Inc.)
- Trading as a Business Workshop
- VectorVest 7 EOD
- VectorVest 7 RealTime/IntraDay
- VectorVest AutoTester
- VectorVest Educational Services
- VectorVest OnLine
- VectorVest Options Analyzer
- VectorVest ProGraphics v6.0
- VectorVest ProTrader 7
- VectorVest RealTime Derby Tool
- VectorVest Simulator
- VectorVest Variator
- VectorVest Watchdog
- StockCharts.com, Inc.
- Candle Patterns
- Candlestick Charting Explained
- Intermarket Technical Analysis
- John Murphy on Chart Analysis
- John Murphy's Chart Pattern Recognition
- John Murphy's Market Message
- MurphyExplainsMarketAnalysis-Intermarket Analysis
- MurphyExplainsMarketAnalysis-Visual Analysis
- StockCharts.com
- Technical Analysis of the Financial Markets
- The Visual Investor