12 June 2025 : Dow Jones 30 Technical Analysis: Bearish Divergence Looms | June 2025
Warning: The Dow Jones 30 Futures are showing signs of exhaustion and vulnerability near crucial resistance levels. Despite recent highs, several technical indicators suggest a potential sharp correction could be imminent. Our multi-indicator analysis, including RSI Divergence, moving averages, option chain insights, and the latest news sentiment, paints a bearish-leaning outlook that traders should not ignore.
The attached chart shows a textbook example of bearish RSI divergence. While price made a new high around 42,913, RSI failed to follow, printing lower highs — a classic warning sign. The prior two bearish divergences preceded sharp declines, as marked. This setup should not be ignored.
The index is currently trading above its 20-day and 50-day EMAs, suggesting short-term momentum is intact. However, the momentum appears to be losing steam. The pattern resembles a double-top formation — typically a bearish reversal setup, especially near all-time highs.
Option Chain & Sentiment Analysis
Latest option data shows significant call writing near 43,000, indicating resistance. Put buildup is noticeable at 42,000, forming a tight range. VIX remains relatively low, but skew is rising — hinting at potential volatility expansion soon.
Recent news suggests sticky inflation concerns and potential Fed hawkishness are starting to creep back into trader psyche. Geopolitical tensions and weaker job openings data may also be contributing to risk-off sentiment in broader markets.
Trade Levels to Watch
| Level | Type | Comment |
|---|---|---|
| 43,000 | Resistance | Call writing zone |
| 42,000 | Support | Put buildup, psychological round level |
| 41,500 | Breakdown Level | Below this, momentum likely turns down |
Conclusion
Dow Jones 30 is at a critical juncture. The failure to break decisively above 43,000, in conjunction with bearish RSI divergence and option data signals, increases the probability of a short-term pullback. Traders should approach with extreme caution and closely monitor key support levels.
Warning: The risk of a sudden downturn is real. If 42,000 fails to hold, expect increased volatility and downward momentum. This may be a time to consider de-risking or hedging long positions.
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