Failure to launch....

While seemingly on decline, I was not having not much concern on Nikkei and Dow Jones. That is until this weekend. Both charts show indications of failure in reaching higher grounds.

Fig 1 Dow Jones weekly chart

During my last up-date, Dow Jones was seen with a long bar resting above moving averages. While the following weeks have shown some signs of weakness, the bars were short and it was not much of a concern. In fact until last week, Dow still stayed above the 55-week moving average mark. However, the bar shown this week changes everything.

To start with We can see that there is an attempt this week for Dow to reach higher, in fact it managed to break the previous high achieved on week of 27th March 2022. If it manages to stay up till the end of the week, it will be more certain that Dow will continue its climb. However, it failed after testing the new high and plunged below the 55-week moving average. 

This is not a good sign for long and it will continue its fall. Its immediate support level is around32,000 and if this cannot hold, 30,901, coinciding with its 144-week moving average.

Fig 2 Nikkei weekly chart

In my last entry on Nikkei, while I was less optimistic on Nikkei, I figured that it is still possible for Nikkei to go higher before continue its down slide. I expected a possible correction before its climb, and the seemingly hammer last week provide a probable indication of Nikkei in continuation up-ward. 

Yet similar to Dow Jones, it tried climbing up but stopped by both 8 and 2-week moving averages.  It closed for the week with a much lower value. We are likely to deal with a down trend continuation. 

The support levels that I am seeing for Nikkei are 25,623 followed by 23,739. 

For some reason, I personally feel that 25,623 is a more viable level. It coincide with the 144-week moving average support. There is a chance that Nikkei to re-bounce upon touching this support level. 

Crossing this point however, is going to be a very different story, we might be seeing a trend reversal on the weekly time frame. 

For the time being, its gradual gradient is still giving me some confidence that we are still on a counter wave.