LIVE MARKETS Dow Industrials: Slip turns to slide

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DOW INDUSTRIALS: SLIP TURNS TO SLIDE (0900 EST/1400 GMT)

After ending January 4 at a record close of 36,799.65, the Dow Jones Industrial Average (.DJI) has now collapsed nearly 7% in just 12 trading days read more .

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Much of this decline has come with a current six-day, near-6%, losing streak. And with CBT e-mini Dow futures reversing an overnight gain of 253 points, and now pointing to a loss of around 250 points at the open, the blue-chip average may threaten a seventh-straight day of losses.

The Dow last fell seven days in a row in February 2020, in the early stages of what would ultimately prove to be a 37% meltdown on a closing basis. The Dow last declined eight-straight days in June 2018.

Therefore, at least shorter-term, in terms of its streak, the DJI may be getting stretched to the downside.

Of note, the DJI ended Friday essentially right on its broken weekly log-scale resistance line from 1929, which has been acting as support since it was overwhelmed early last year. However, with opening weakness, the DJI will be below this line, which will ascend to around 34,300 this week:

DJI01242022

Additional Dow support can be found at its mid-to-late 2021 troughs at 34,006, 33,613 and 33,271.

The 23.6% and 38.2% Fibonacci retracements of the entire March 2020 to January 2022 advance are found at 32,530 and 29,794. The Dow's February 2020 peak was at 29,568.

In the event of sudden strength, which puts the DJI back over the line from 1929, it will still have work to do to repair its recent damage. This, given that its 40-week and 10-week moving averages are now resistance, and ended at 35,030 and 35,511 last Friday.

(Terence Gabriel)

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Terence Gabriel is a Reuters market analyst. The views expressed are his own

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