DJI: Upside to 48,600-49,000 next

We just published our Oct 28th Charted Market Insights report, which features update charts on views on the S&P 500 and NASDAQ 100, but what about the Dow Jones Industrial Average (DJI)?

The Dow Industrial Average (DJI): Record highs with 48,600-49,000 next target

The DJI broke to new record highs, completing a bullish consolidation pattern from early October. While above the 47,000-46,750 area (breakout point and 61.8% extension), this tactical breakout remains in place with upside potential to 48,600 (pattern count) and 49,000 (upside target for the March-June head and shoulders bottom - May 28 The Chart Check).

The breakout from the November 2024-August 2025 big base remains intact above 45,000 and projects longer-term upside to 53,000 (100% extension) and 53,400 (pattern count).

Rising 13-, 26-, and 40-day moving averages offer risk management support near 46,480-46,199.

Chart 1: Dow Jones Industrial Average (DJI): Daily chart

Hope for best, prepare for worst: Risk management around the weekly upside gap

Similar to the S&P 500 and NASDAQ 100, the DJI gapped up on its daily and weekly charts. This gap at 47,375-47,436 leaves the DJI in a technically precarious position. Keeping this gap open through this week and beyond would suggest a bullish runaway gap that favors continued upside into year-end. However, if the DJI falls and immediately fills the gap, we will turn our attention to two key levels: 46,760 and 46,312. A close this week below 46,760 would create a bearish dark cloud cover pattern, while a close below 46,312 would confirm a bearish engulfing pattern.

Chart notes

• The 46,760 level is the mid point of "real body" for last week's candlestick. The real body is the distance between the open and the close. A white real body occurs when the close is above the open and a black real body occurs then the close is lower than the open. After an upside gap above the prior price bar's high, a close below the mid point of the white real body (DJI - 46,760) would create a weekly dark cloud cover candle pattern, which is a potentially bearish signal.

• If the upside gap gets filled this week and the DJI closes below last week's open (DJI - 46,312), it would generate a weekly bearish engulfing pattern.

• We are highlighting this for risk management purposes.

Chart 2: Dow Jones Industrial Average (DJI): Weekly candlestick chart