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Dow Jones opens and closes below 21 day moving average

Yesterday the Dow Jones reopened at 37,493. It later closed at 37,361 after finding a low on the session at 37,201. The 21 day moving average was in place, as of the close last night at exactly 37,500. So, the index opened and closed below this level and that was the first such daily close below its 21 day moving average since November 1. Hence, this could prove significant. If you care to look at a chart of the index you will see what I am talking about and most especially about the 21 day moving average defining the trend from above 33k. That trend, as it unfolded resulted in a Santa Claus rally and to record all time highs most recently. So, has the trend come to an end now? Well, if you look at that chart, it is entirely possible and that it is certainly in the midst of what is a clearly overdue correction. As to how far that correction might extend from here is another matter though. I  did state last week; that I would not want to be long on this index at such lofty levels after the latest US CPI data hit the screens. I merely wish to remind readers of those comments today. The Dow Jones futures are currently pricing the reopening at around 37,225
 

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