Dow Jones Seeking Bullish Consolidation
The Dow Jones has maintained a sideways movement since the end of February, in part due to industrial companies' expectations of inaction on debt policy changes by the Federal Reserve to curb current inflation. The index has been consolidating prices all month, closing yesterday with a 0.83% gain at 39,110 points, driven also by the Standard & Poor's 500 and Nasdaq, which closed at 5,178 and 16,166 points respectively. Even the VIX Volatility index, known as the fear index, reflected a 3.6% drop, including a decline in the U.S. 10-year bond of 0.1% to 4.293%. The Dow Jones gain of more than 300 points came on expectations that the Fed will hold policy today, Wednesday. However, there were concerns today that the central bank would signal a possible rise in inflation, which could extend high interest policies for longer than investors expect. Obviously, this was reflected in all 3 indices as a bubble of bullish excitement. Today that excitement may be somewhat more contained and there may be a more than healthy and predictable correction. The U.S. bank association releases on the mortgage purchase index, crude oil data, and the FOMC release on economic projections and interest rates are high impact today.
Looking at the chart, the index has followed a predictable sideways movement, as mentioned above. Since October, its rise to the highs in the Christmas rally has represented a disconnected bullish chart. At this stage of strong hand consolidation, we see that the bullish channel has materialized into a formation at the bottom of a long-term uptrend.
The development of the index suggests that it is looking to reach 43,345.13 points, coinciding with the 1,618% Fibonacci extensions and the middle zone of said long-term trend. However, in order to maintain this direction, the economic outlook of the companies that make up the index must support said price; otherwise, the stock will deflate. At the moment, the price bell weighs heavily around 33,857.31 points, while the RSI stands at 59.44%. This suggests the possibility of a correction towards the 38,646.05 point area, one of the July 2023 supports. It only remains to be seen how the market will take the Fed's statements.
Attached is the composition of Dow Jones on TV to better understand what type of industrial market it is: es.tradingview.com/symbols/DJ-DJI/components/
Ion Jauregui - AT Analyst
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La información facilitada no constituye un análisis de inversiones. El material no se ha elaborado de conformidad con los requisitos legales destinados a promover la independencia de los informes de inversiones y, como tal, debe considerarse una comunicación comercial.
Toda la información ha sido preparada por ActivTrades ("AT"). La información no contiene un registro de los precios de AT, o una oferta o solicitud de una transacción en cualquier instrumento financiero. Ninguna representación o garantía se da en cuanto a la exactitud o integridad de esta información.
Cualquier material proporcionado no tiene en cuenta el objetivo específico de inversión y la situación financiera de cualquier persona que pueda recibirlo. La rentabilidad pasada no es un indicador fiable de la rentabilidad futura. AT presta un servicio exclusivamente de ejecución. En consecuencia, toda persona que actúe sobre la base de la información facilitada lo hace por su cuenta y riesgo.
Looking at the chart, the index has followed a predictable sideways movement, as mentioned above. Since October, its rise to the highs in the Christmas rally has represented a disconnected bullish chart. At this stage of strong hand consolidation, we see that the bullish channel has materialized into a formation at the bottom of a long-term uptrend.
The development of the index suggests that it is looking to reach 43,345.13 points, coinciding with the 1,618% Fibonacci extensions and the middle zone of said long-term trend. However, in order to maintain this direction, the economic outlook of the companies that make up the index must support said price; otherwise, the stock will deflate. At the moment, the price bell weighs heavily around 33,857.31 points, while the RSI stands at 59.44%. This suggests the possibility of a correction towards the 38,646.05 point area, one of the July 2023 supports. It only remains to be seen how the market will take the Fed's statements.
Attached is the composition of Dow Jones on TV to better understand what type of industrial market it is: es.tradingview.com/symbols/DJ-DJI/components/
Ion Jauregui - AT Analyst
**********************************************************************************************************
La información facilitada no constituye un análisis de inversiones. El material no se ha elaborado de conformidad con los requisitos legales destinados a promover la independencia de los informes de inversiones y, como tal, debe considerarse una comunicación comercial.
Toda la información ha sido preparada por ActivTrades ("AT"). La información no contiene un registro de los precios de AT, o una oferta o solicitud de una transacción en cualquier instrumento financiero. Ninguna representación o garantía se da en cuanto a la exactitud o integridad de esta información.
Cualquier material proporcionado no tiene en cuenta el objetivo específico de inversión y la situación financiera de cualquier persona que pueda recibirlo. La rentabilidad pasada no es un indicador fiable de la rentabilidad futura. AT presta un servicio exclusivamente de ejecución. En consecuencia, toda persona que actúe sobre la base de la información facilitada lo hace por su cuenta y riesgo.
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