Dow Jones
Dow Jones is back at the highs of the recent range in the after-hours following the last Presidential Debate. With a little over a week until the big Elections Day in the United States, the Dow Jones keeps a bullish bias.
Buyers stepped in on every single dip so far in the past weeks. As such, the Dow seems to form a bullish flag pattern. A bullish breakout would easily push the Dow to new all-time highs. However, the question for now remains – will the breakout come before or after the elections?
Last night in the United States, the last Presidential Debate took place. Put it simply – no game-changer. However, both candidates made some interesting remarks that may easily influence the stock market in the period ahead.
First, Biden played a tough card against oil companies and pro climate change policies. In doing so, he may have upset the Rust Bet voters with the remarks against the so-called “brown energy”.
Second, Trump made headlines by promising a vaccine within a week. While that is unlikely to happen, at least if one considers the production time needed for a vaccine to be readily available to masses, it may signal that the United States is closer to a cure than many believe.
In the meantime, the Dow coils below the all-time high level. Truth be told, the likelihood exist that the index fails to reach a new all-time high ahead of November 3rd elections. For this reason, bulls may want to wait for a breakout before actually going on the long side.
Therefore, it makes sense for bulls to place a pending order at 29,000 with a stop-loss order at 28,100 and a take-profit at 30,750 as suggested by the bullish flag’s measured move. By risking 800 points for a gain of 1,750 points, traders use a risk-reward ratio bigger than 1:2, good enough for trading any market.
