Dow Jones At Fresh Record High as Powell Testifies in Senate Banking Committee

Summary:
• Dow Jones Industrial Average is extending the recent gains as investors shrug off coronavirus concerns. The Dow Jones on the opening adds 0.70% at 29484

Dow Jones Industrial Average is extending the recent gains as investors shrug off coronavirus concerns. The Dow Jones on the opening adds 0.70% at 29484 making fresh all-time highs.

In his testimony in the Senate banking panel Fed Chairman Powell said that it is important the fiscal policy be in a position to support the economy in a downturn. He is also concerned about the level of the US debt. The federal debt growth needs to be slower than the GDP growth. He thinks the idea of putting treasury and reserves on an equal footing is a “good goal”.  Fed is very focused on the threat of cyber attacks. As cyber-attacks could sap confidence in the financial sector.

Yesterday, Fed’s Chair Jerome Powell said that the Fed policy is well-positioned after the three rate cuts in 2019. Jerome Powell also said that the Fed is ‘closely monitoring’ the coronavirus outbreak in China. Powell sees inflation rate to gradually moving towards the two per cent target.

On the economic data, the U.S. MBA Mortgage Applications dropped to 1.1% in February 7 from the previous 5%. Yesterday, the NFIB Business Optimism Index registered in at 104.3 topping the forecasts of 103.4 in January. The U.S. Redbook Index fell from the previous 0.2% to -0.7% on February 7. The yearly reading declined to 4.8% on February 7th from the prior reading of 5.7%.

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Dow Jones Technical Outlook

Dow Jones hits another all-time high today as the index in a clearly bullish path.  Despite the recent headwinds the Dow Jones hits higher highs and higher lows. Now investors believe that every pullback looks like a buying opportunity.

On the upside, the initial obsatcle for the Dow Jones index will be met at 29,536 the daily and all-time high. Next resistance for the Dow Jones index will be met at 29.600 psychological mark.

On the other side, first resistance for the Dow Jones index stands at 29406 the daily low. In case of a break lower the next support zone for Dow Jones will be met at 29220 the low from yesterday’s trading session. Next support zone for the index would be met at 28990 the low from Februaaary 10^th.