Know why 34,000 is a crucial level for Dow Jones? How is it correlated with Nifty50?

The level of 34,000 is crucial for Dow Jones Industrial Average index and is also a point where this index bottoms out. In this exclusive research by Zee Business’ Varun Dubey, the Senior Research Analyst tells that this is a strong support level for Dow Jones.

Dubey said that Dow Jones bottoms out whenever it is at this level and from here, a rally of 2000-2,500 is seen.

On 4 October 2021, the index ended around 34,000 and there was a one way rally till 8 November 2021 when it hit 36,432.

On 1 December, Dow ended at 34,022 to see a one-way rally till 36,800 on 4 January 2022.

On 27 January 2022, Dow again fell to 34,160 and then witnessed a rally till 35,768.  

He said that Nifty50 has had a direct correlation with the Dow Jones movement. On 4 October, Nifty50 ended at 17,691 while it went up to 18068 on 8 November. This was a 380 points rally. From 1 December to 4January, Nifty50 witnessed a rally of 638 points while from 27 January to 9 February, this 50-share index went up by 354 points.

The trend suggests that if Dow fall by 300 points at max, a rally of 2000 points could be seen. If this happens Nifty50 could also see a 300-400 point rally.

At the time of the research, Dow Jones was trading around 34,312 so the downside for it was unlikely to be more than 300 points.

After hitting the support level of 34,000, the least that it had moved was also a 1600 points rally, Dubey said.

This trend has been taken over a period of 5 months and if Dow breaches this level, then it could be said as a trend reversal. So a rally of 5-9 per cent is seen from this level.

Drawing correlation with Nifty50, Dubey said that if Dow moves up 5 per cent, Nifty50 appreciates by 2-3 per cent.

For Nifty, the downside risk is 200 points but the upside is 350-400.

Watch Zee Business Tweet Video Below:

डाओ में 34000 का स्तर कितना अहम ?
क्या तेजी के लिए तैयार है बाजार?

समझिए पूरी डिटेल वरुण दुबे की रिसर्च में @AnilSinghvi_ | @VarunDubey85 | #StockMarket | #DowJones | #Nifty | #BankNifty pic.twitter.com/1jiafi7N59

— Zee Business (@ZeeBusiness) February 18, 2022

Today, Nifty50 ended at 17,276.30 and was down by 28 points or almost 0.16 per cent.