Charting the Markets: Correction in the Dow Industrials May Have Ended

Avatar photo Bob Lang on October 5, 2026

Charts

One of the two weak indexes over the last two months has been the Dow Industrials ($DIA). The “industrials” peaked in July and since then have been on a bad trip, making a series of lower highs and lower lows.

That is our textbook definition of a downtrend, of course, and the indicators have been consistent with the situation. However, a stock or index can fall far enough in time and price to reach levels that might offer a good contrarian move. I think we have arrived at that moment for the DIA.

Take a look at the chart. While the recent slide has been defined, the candles are still teal, so cautiously bullish. That is important, as the index has now landed on the lower Bollinger, often a place where dip buyers get active. I expect that to happen as earnings season gets underway.

Money flow is struggling to stay positive, the MACD remains on a sell signal and momentum has slowed significantly. Nothing is easy or clear here, but the odds favor a nice bounce in the coming weeks.

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Posted by Bob Lang

Bob Lang is one of the country’s top options traders, an expert market technician, and a highly sought-after mentor and teacher. He is a private trader in equity and option markets and created his own hedge fund and options trading company called Explosive Options. He is also founder and Chief Options Analyst at Aztec Capital, LLC. He has been a regular contributor to TheStreet Pro's paid subscription products since 2009. Lang is both a short-term trader and long-term stock investor. He utilizes technical and fundamental analysis to find investment opportunities. His coverage for TheStreet Pro specializes in options trading, stock investing, and technical analysis. One of Lang’s claims to fame is his creation of the acronym FANG to describe the top tech companies at the time (Facebook, Amazon, Netflix, and Google). The acronym has since expanded considerably and is still widely used today. He is the author of the book “Know Your Options” and holds an MBA from the University of Redlands. When he’s not providing financial commentary for TheStreet, he can be found on the tennis court, reading, or traveling.

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