The DOW ended Thursday down more than 1,000 points. The stock market is officially in a correction, defined as a 10% decline from its most recent high. Price broke through weekly demand at 24,100. There is more weekend demand at 23,300. However, I anticipate the DOW to close the week lower on Friday because nobody want to put on new positions going into the weekend.
If the next weekly demand is broken, look for price to go down to the monthly demand at 22,000 (represented by the yellow rectangle). Monthly demand and supply zones tends to be stronger than weekly demand and supply zones.
Not only has the DOW erased all the gains for 2018, but the DOW is in the process of closing below the December 2017 low of 23,936 as well.
The last time this happen was back in July of 2015, in which the DOW dropped another 2,500 points afterwards. The markets are still fairly strong as indicated by low unemployment, higher job wages and increased interest rates, so I don't anticipate another 2,500 point drop. What we are experiencing is a healthy pull back in a market that was over extended.
For a deeper explanation of why the Markets are correcting, look out for my next Wall Street Secrets Revealed post next week.
This post is my personal opinion. I’m not a financial advisor. Do your own research before making investment decisions. By reading this post, you acknowledge and accept full responsibility of any gains or losses.