Dow Jones 30 plunges 320 points! What’s next?
Global stock markets crashed lower yesterday as investors hit the panic button after an alarming rise in worldwide coronavirus infections. Investors have enjoyed significant gains in equity markets over recent weeks with many trading at new record highs.
While the Dow Jones 30 index plunged more than 320 points lower, the fall was roughest on airline, travel and leisure stocks. Boeing shares were down more than 4% at one point, with United Airlines down 9% and American Airlines down 6%.
In the daily chart below of the Dow Jones 30 index (DJI30), it’s clear to see that the uptrend is still intact. The plunge yesterday could be profit-taking on what has been a strong rally higher.
Source: Admirals MetaTrader 5, DJI30, Daily - Data range: from Aug 3, 2020, to Apr 20, 2021, performed on Apr 20, 2021, at 8:30 pm GMT. Please note: Past performance is not a reliable indicator of future results.
Last five-year performance: 2020 = +7.09%, 2019 = +22.66%, 2018 = -5.46%, 2017 = +24.76%, 2016 = +12.74%, 2015 = -2.28%.
Historically, the price has been moving away and back towards the moving averages, in particular, the 20-period (blue) exponential moving average and the 50-period (red) exponential moving average.
If the price continues lower, traders may be watching these moving averages closely for new positions back in line with the overall trend.
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