The Dow breakout above 18,300 is significant, but it is also weak. This is confirmed both with chart analysis and with some fundamental analysis. The Dow chart has two significant chart patterns and they combine to limit the Dow rally in the short-term.
The first feature is the well-established trading band. The lower edge of the trading band is near 15,600. The upper edge is near 18,300. The width of the trading band is measured and then projected upwards. This gives a target near 21,000 for the Dow. This is a long-term target. The Dow is making new highs but there are technical chart features which limit the way the Dow moves to achieve the 21,000 target.
The second feature on the Dow chart is a long-term uptrend line. This uptrend line started in October 2011. To understand the significance of this trend line, we need to understand the way trend lines change polarity or function. Between October 2011 and August 2015, the uptrend line acted as a support level. The Dow would pull back to this level and then rebound and continue the uptrend.
In August 2015, the Dow moved below the uptrend line. Many people believe that when this happens it means a new downtrend starts. This is not correct. It means the nature of the trend has changed and with the Dow, it means the trend line changed polarity and now acts as a resistance line. When the Dow rallied in November 2015, the trend line acted as a resistance level. The trend line is projected into the future and it will continue to act as a resistance level.