- Summary:
- Dow Jones Index: Our analysis shows that Dow Jones Industrial Average may drop to $32,800 in the coming weeks.
Dow Jones (INDEXDJX: .DJI) Index is showing signs of weakness as the bulls lose momentum after a strong rally. Dow Jones Industrial Average has underperformed the S&P 500 index and Nasdaq 100 index since the start of the year. In fact, the latter has just hit its new yearly highs today.
On Monday, Dow Jone Index closed the day with a 55.69 points drop. This meant a 0.17% loss for the benchmark index during the first trading session of the week. The drop came on a day when S&P 500 and the Nasdaq 100 index both closed the day in the green.
Dow Futures Tank Today
Dow futures kept falling during their London session on Tuesday. The bearishness can also be attributed to the bounce in the DXY index. The dollar strength index has bounced from its 101 points support once again and was up 0.13% today.
The April 2023 CPI report is set to release tomorrow. This will show the increase or decrease in inflation in the last month. A significant increase in inflation may cause a strong bounce in the DXY index, which will keep Dow Jones Index in a downtrend.
Dow Jones Index May Retest 32,800 Soon
A look at the INDEXDJX: .DJI shows that the time is running out for the bulls. The index has recently formed a lower low on the daily chart which suggests that another retest of the 200 MA is on the cards. The 200-day moving average currently lies at 32,800.
However, there is also a possibility of a retest of the 34,200 resistance before a major correction. Only a break above this level can make Dow Jones Index forecast bullish. A breakdown below 200 MA will give bears full control.
I’ll keep posting my Dow Futures analysis in my free Telegram group, which you’re welcome to join.
