- Summary:
- The October CPI data and testimony by the US Fed Chair Powell will provide momentum for the price action on Dow Jones Industrial Average today.
The Dow Jones futures are trading lower in Wednesday’s afternoon session ahead of the US October Consumer Price Inflation (CPI) data, to be released at 1:30pm GMT today. Another potential market mover scheduled for 4pm GMT is the keynote address by US Fed Chair Jerome Powell. FOMC member Kashkari is also scheduled to speak at 6:30pm GMT.
These are all potential market movers for Dow Jones futures and the industrial average which opens in less than 2 hours from now.
Key Data Could Trigger Big Moves on the Dow
The monthly CPI data for October shows that economists expect consumer inflation to have ticked up by 0.3%. The Core CPI is also expected to have firmed to 0.2%.
The Fed Chair Powell will also provide testimony about the US economy before the Joint Economic Committee of the US Congress. Coming on the back of yet another round of criticism from US President Donald Trump, the Fed Chair will most likely be grilled about monetary policy.
These events could determine the Dow’s direction on the day.
Technical Outlook for Dow Jones
After coming just short of touching off new all-time highs yesterday, the Dow is experiencing a selloff after US President Donald Trump failed to make any significant comments about the US-China trade situation in his speech yesterday evening. This was largely seen as a negative signal, hence the initial selloff since in the early price action from Dow Jones futures on the day.
The Dow is very close to touching the upper trendline of the long-term rising wedge seen on the weekly chart. However there is still space for more upside movements, if the markets like what they hear from US Fed Chair Powell.
Intraday, the Dow has found support at 27564 (S2 pivot). A break below this level targets 27,545 where we have a cluster of previous lows formed earlier this week, and previous highs formed on November 5 and 6, 2019. Below this level, 27,493 (S3 pivot) comes into focus.
If the current support holds and the news for today are Dow-positive, then we could see a further push to the north that targets the November 7 highs of 27,627 (S1 pivot) and 27,699 (central pivot).