- Social Hub
- Offering
- Resources
- Company
- Partnerships
- Home
- Markets Updates
- Dow Jones Eyes 39,000 After Triangle Break
US30 30-Minute Timeframe, 28 February 2024
The $US30 index, also known as the Dow Jones Industrial Average, is a stock market index created in 1896 that monitors the performance of the 30 largest publicly traded companies in the United States.
The $US30 on a 30-minute timeframe has generally been trading in an uptrend and started a steady decline after the February 23 high of 39303.
It appears that the $US30 is showing a tendency to follow the 20 and 50-period simple moving averages, particularly the area between them. The chart illustrates that there are several instances where these moving averages have acted as solid dynamic support and resistance levels.
It is quite evident, even just on this small sample of the $US30, that classical chart patterns are respected (marked in magenta lines on the chart). On February 21, a triangle pattern formed, which convincingly broke to the downside, followed by a retracement and another 190 pip move down. The diminishing volatility on the ATR indicator just before the breakout is worth noting.
We observed a textbook head and shoulders pattern between February 22 and February 26. The neckline was broken by a strong and convincing bearish candlestick. This was followed by a retest of the neckline, which resulted in a fall of 370 pips. Again, it is worth noticing the diminishing volatility on the ATR before the downward move.
This brings us to the formation of the current chart pattern (Triangle 2), where the market shows a decreasing range by forming lower highs and higher lows. Additionally, the ATR indicator suggests that volatility is at a local low, creating a favourable situation for a potential breakout.
The potential breakout can be either upward or downward, but there is a slightly stronger downward bias due to the recent strong head and shoulders pattern.
A more conservative way to trade triangle breakouts is to wait for a clear and convincing breakout to avoid false breakouts. Once there is a breakout, you can wait for a retracement and then enter the trade. However, this method might cause you to miss out on some trades and potentially result in less profit, but with the added advantage of having fewer losing trades.
The alternative is to take the trade on the breakout. This way, you can enter at a more favourable price, which can lead to greater potential profit. However, there is also a higher chance of being caught in fake moves.
In the event of an upward breakout, the target can be 39,000 towards 39,100. In the case of bears leading the breakout, we can target the next support level at 38,685.
Keep an eye out for shifting investors' sentiment or changing fundamental factors.
Summary:
- US30 comprises the top 30 largest publicly traded companies in the USA.
- The US30 Respects classical chart patterns like triangles and head and shoulder patterns.
- The market is currently forming a Triangle pattern with diminishing volatility.
- A break to the downside could potentially target the 38,685 level.
- A break to the upside could target the 39,000 or 39,100 level.
IMPORTANT NOTICE: Any news, opinions, research, analyses, prices or other information contained in this article are provided as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and therefore, it is not subject to any prohibition on dealing ahead of dissemination. Past performance is not an indication of possible future performance. Any action you take upon the information in this article is strictly at your own risk, and we will not be liable for any losses and damages in connection with the use of this article.
RISK WARNING: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. A high percentage of retail client investors lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Related articles
NAGA Weekly Recap May 26 - 30, 2025
30 May 2025
Markets gain ground as inflation cools slightly and tech leads the way. The Fed stays cautious, while gold dips, oil holds, and the dollar stays firm.
Read more
Gladys Eguia
NAGA Weekly Recap May 26 - 30, 2025
30 May 2025
Markets gain ground as inflation cools slightly and tech leads the way. The Fed stays cautious, while gold dips, oil holds, and the dollar stays firm.
Read more
Gladys Eguia
Need Help? Visit our Help Section
Download NAGA Trader
Markets
Platforms
Pricing & Terms
Company
Documentation
Partnerships
Help & Support
Social Hub
Free Education
News & Analysis
Download NAGA Trader
Copyright © 2024 – All rights reserved.
NAGA is a trademark of The NAGA Group AG, a German based FinTech company publicly listed on the Frankfurt Stock Exchange | WKN: A161NR | ISIN: DE000A161NR7.
The website is operated by NAGA Capital Ltd which is authorised and regulated by the Financial Services Authority Seychelles (FSA) under licence No. SD026. The registered address of Suite 3, Jivan’s Complex, Global Village, Mont Fleuri, Mahe, Seychelles. Tel: +248 4373121
Partner Companies: NAGA Markets Europe Ltd, authorised and regulated by the Cyprus Securities and Exchange Commission ("CySEC") under license No. 204/13 with registered address at Agias Zonis 11, Limassol, 3027, Cyprus and NAGA Global (CY) Ltd, with registered address at Nikokreontos 2, NICE DREAM, 6th floor, Flat/Office 601, 1066, Nicosia, Cyprus.
RISK WARNING: Derivatives are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how derivatives work and whether you can afford to take the high risk of losing your money. This is not investment advice. Trading with NAGA Trader by following and/or copying or replicating the trades of other traders involves high levels of risks, even when following and/or copying or replicating the Lead Traders. Such risks include the risk that you may be following/copying the trading decisions of possibly inexperienced/unprofessional traders, or traders whose ultimate purpose or intention, or financial status may differ from yours. Before making an investment decision, you should rely on your own assessment of the person making the trading decisions and the terms of all the legal documentation.
Restricted countries: NAGA Capital Ltd does not provide services for the residents of certain countries, such as Afghanistan, Albania, American Samoa, Anguilla, Australia, Austria, Barbados, Belarus, Belgium, Bermuda, British Indian Ocean Territory, Bulgaria, Burkina Faso, Canada, Cayman Islands, Central African Republic, Christmas Island, Cocos (Keeling) Islands, The Democratic Republic of the Congo, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Falkland Islands (Malvinas), Finland, France, Germany, Gibraltar, Greece, Guam, Haiti, Heard Island and McDonald Islands, Hungary, Iceland, Islamic Republic of Iran, Ireland, Isle of Man, Israel, Italy, Jamaica, Japan, Jersey, Democratic People's Republic of Korea, Latvia, Libyan Arab Jamahiriya, Liechtenstein, Lithuania, Luxembourg, Mali, Malta, Montserrat, Mozambique, Myanmar, Netherlands, New Zealand, Norfolk Island, Norway, Palestinian Territory, Occupied, Pitcairn, Poland, Portugal, Romania, Russian Federation, Saint Helena, Ascension and Tristan Da Cunha, San Marino, Senegal, Serbia, Slovakia, Slovenia, Somalia, South Georgia and the South Sandwich Islands, South Sudan, Spain, Sri Lanka, Sweden, Switzerland, Syrian Arab Republic, Trinidad and Tobago, Tunisia, Turks and Caicos Islands, Uganda, Ukraine, United Kingdom and any other countries where the citizens have British proof of identity (i.e. British Virgin Island, Gibraltar, Isle of Man etc.), United States, U.S. Minor Islands, Vanuatu, Virgin Islands, British, Virgin Islands, U.S., Yemen, and Zimbabwe.