July 18, 2022, 1:45 pm EDT
Short-term Rebound and Major Obstacles
Dow Jones rebounded last Friday but it encountered two significant obstacles ahead:
- 32000: gap-down zone resistance created by 07/10
- 33200: significant resistance created by 07/09
Currently, the convergence pattern has an upper boundary of 31600 which also gave bulls a hard time.
The big picture remains in favor of bears. Even though there is a short-term rebound, these obstacles resulted from the deterioration of economic conditions after inflation, rising rates, global slowdown, wars, and various factors.
We can use these obstacles to measure the strength of the rebound during the earnings season. If the bulls cannot overcome them, we beleive bears will emerge again to knock down bulls for the new lows for the stock markets.