Wall Street sees the DJIA continue in its technical pull-back

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  • The Dow Jones Industrial Average (DJIA), ended down by 111 points or by 0.4%, at 26,485. 
  • The S&P 500 index added just up 2 points to 2,929.
  • The Nasdaq Composite Index COMP, climbed a modest 23 points, or 0.3%, to 8,125. 

U.S. stock prices were mostly higher with a mixed performance once again in the indexes on the back of earnings results, data and global growth sentiment all in the mix.  As for performances, the top performers on Wall Street came in the tech-sector results highlighted by Facebook Inc. and Microsoft Corp. The DJIA was weighed upon by disappointing 3M Co. earnings.

U.S. data

Analysts at ANZ Bank noted that the US durable goods were up 2.7% m/m in March, stronger than the 0.8% increase expected. “Core orders were also higher than expected, up 1.3%, the strongest rise in 7 months (mkt: 0.2%). The three month annualised average rose to 2.1% from -3.0%, after four consecutive months of negative prints.”

Looking ahead: 

The key data for the immediate – near future that traders and investors will look for triggers will start with  the USD and global outlook 1) US – advance Q1 US GDP, 2) FOMC, 3) ISM and 4) payrolls; 5) Then, from the Eurozone – we have 1) Q1 GDP, final 2) April PMIs and 3) April advance CPI data; and  from China – 1) NBS and 2) Caixin PMIs.

DJIA levels

Technically, bears now look for a test below the 20-D SMA, and then 26000 opening risk towards 25700s. First, the 20-D SMA (session lows) and the hourly 200-SMA need to give, (200 HR SMA is located at 26150). A subsequent break of the 50-D SMA just below 26000 opens risk to the 23.6% Fibo retracement of the late Dec rally at 25500 guarding 25300 (200 D SMA). A break all the way down to the 24800 gap area would come into target ahead of the 24500s and then 50% of the upside run made at the end of Dec at 24150.

 

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