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Dow Jones Index Turns Green After 4 Consecutive Red Days

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Written By: Abdullah Sarwar
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    Summary:
  • Dow Jones Index has bounced after a disappointing last week. The positive earnings reports have eased the selling pressure.

On Tuesday, Dow Jones index finally turned green after extending losses for four consecutive days. The bulls can thank the pause in the bond sell-off for the recovery as the index currently sits 0.65% above its Monday lows. At press time, the benchmark of bluechips is standing at 33,131 points and is down 3% from its monthly highs.

On Tuesday, bullish sentiment surrounded Wall Street as the decline in treasury bond yields gained momentum. The 10-year bond yield suffered a 3% correction from its 16-year high levels due to the conflict going on in the Middle East.

US Stocks Recover Amid Positive PMI Data

On Tuesday, S&P Global released the PMI numbers for the US. The manufacturing PMI was 50, as compared to the expected 49.5. The services PMI stood at 50.9, 1 point more than the expected 49.9. The improvement in these figures suggests that inflation might be cooling down as the US economy grows stronger.

Increased optimism is being felt in the US markets as big companies like Verizon, Coca-Cola, and General Electric updated their forecasts. The next week’s FOMC meeting will also be crucial for the markets as investors expect the Federal Reserve to keep the current rates unchanged.

Dow Jones Index Forecast

The chart below for the Dow Jones index shows the index bouncing from a repeatedly mentioned key technical level of 32,800 points. This bounce from the support has the potential to turn into a relief rally.

A deeper analysis also reveals a bullish divergence forming in the RSI which may result in a relief bounce in the coming days. This will put a retest of the 33780 points resistance level on the cards.

The Dow Jones index forecast is looking bearish due to its intense rejection from the 200 MA. In addition, the benchmark index has also flipped the 33,780 points support into resistance. The bears are expected to remain in control as long as the index is under 33780 points level.

Dow Jones Industrial Average

This post was last modified on Oct 24, 2023, 22:03 BST 22:03

Written By: Abdullah Sarwar

Abdullah Sarwar is a blockchain analyst and a cryptocurrency investor with more than 5 years of experience. He specializes in providing crypto price projections based on their fundamentals and price charts. He is also a successful day trader. He graduated in 2015 with a degree in electronic engineering. In his free time, he loves listening to electronic music and playing with trading bots.

Published by
Written By: Abdullah Sarwar