Dow Jones Falters In Quest to Break Above 30,000; Could the FOMC Help Out?

Summary:

After hitting all-time highs yesterday, the Dow Jones Industrial Average has faltered in its attempts at a conclusive break above 30,000.

The Dow Jones Industrial Average has had a flat opening, despite news of a second coronavirus vaccine awaiting approval, and talk of fiscal stimulus consensus by leaders of the US House and Senate.

The Dow touched off a new all-time high on Monday, but quickly lost momentum and headed south to close at 2-week lows. Despite driving towards the 30,000 mark as the session opened, sellers quickly intervened and sent the Dow off intraday highs.

Coronavirus-related deaths topped the 300,000-mark this week, and with new restrictions in place, buyers on the Dow Jones are struggling for reasons to seize the initiative. This is all coming ahead of tomorrow’s FOMC meeting. Bulls may need to look towards the vaccine front for more impetus, especially as Moderna is seeking emergency use approval from the FDA. Hearing is slated for Thursday. The Dow is up slightly more than 35 points at of the time of writing.

Technical Levels to Watch

The Dow Jones has hit the apex of the symmetrical triangle with neither a convincing breakout of breakdown, which increases the chances that the pattern will fail and price may continue to trade sideways in the near-term.

30353 is the new all-time high and is now the level to beat for buyers. However, buyers must overcome the resistance at 30101 to target this point, and a breach of 30353 may finally allow for a breakout move that targets 31158 (78.6% Fibonacci extension from the 13 May to 2 September swing move).

On the other hand, a clear breakdown below 29842 targets 29255, with 28979 serving as the additional near-term target to the south. The FOMC decision could be the catalyst for the next major moves on the Dow Jones this week.