DJII Price Set For New Highs Through Year End

While not an avid supporter of the Technical Arts I know enough to be dangerous. On March 11 2016 when the DJII was at 16,995 I published an article entitled:

“Technicians May Soon Be Forecasting DJII at 21,000”

In the article I wrote:

"Since May 2015 the DJII has fallen to approximately 16,000 twice and technicians may well recognise the formation of a double bottom “W” formation. This should lead them to postulate that if the current leg up of the DJII breaks out to new high ground then the “count” should carry the DJII to 21,000 in a relatively short time, possibly this year.”

On Mar 21, 2016 I followed up with:

“DJII Technical Breakout to 21.000 Imminent”

In this article I stated:

"The DJII has completed the "W" shaped double bottom formation that was anticipated in the previous blog post. The market is nudging the resistance line at the 17.600 level.

No doubt the technicians will have to wait for a breakout above this level and then some other confirmation or excuse for not pulling the trigger. However, the dividend discount value of the DJII remains at more than twice its price so the fundamental upward pressure continues with no letup in sight"

On June 2, 2016 I published a further article anticipating further strength in the DJII through the summer entitled:

“DJII should sizzle this summer as bears scramble for cover”

The fundamentals have long been pointing to a move to a substantially higher DJII. This now appears to be underway as market participants continue to climb the wall of worry.

In the following chart it appears that we have had the completion of the “W” formation, the breakout from the downtrend, and a pull back to test the downtrend. Following this there has been a breakout to a new all-time-high and the subsequent pull back to test the new down trend.

With the dividend-discount-value of the DJII standing at 44,400 the fundamentals still point to the a much higher DJII price and now the pullback testing phase seems to be over the target of 21,000 on the DJII this year still seems to be a distinct possibility.