The Dow Jones Index warms up to an upbeat week on Monday, propelled by a bullish outlook ahead of multiple earnings reports scheduled for release this week. The Index ended last week on a high note, having gained 0.97 percent to hit new all-time highs of 42,899 points on Friday.
Multiple companies are lined up to deliver their qaurterly results this week, including Dow Jones Index top constituent stocks like UnitedHealth, Goldman Sachs and Johnson and Johnson. That is likely to set up the stocks for a bullish scrum around the stocks in the leadup to and after the releases.
Meanwhile, last week’s Consumer Price Index (CPI) inflation data raised the prospect of the Fed announcing a 25 basis points cut on interest rates in November. In addition, Initial Jobless Claims figures rose for the second successive week, adding support to another rate cut. The Fed already left the door open for additional rate cuts during its September 18 decision announcement.
Therefore, the current trajectory adds bullish momentum to the Dow Jones Index (INDEXDJX: .DJI). Two FOMC members, Neel Kashkari and Christopher Waller will speak in the early hours of the New York trading session, and their comments could provide guidance on the interest rate trajectory.
On the chart below, the Dow Jones Index RSI momentum indicator signals bullishness. The upside will likely prevail if the action stays above 42,686. The first barrier will likely be at 42,813, but an extended bullish control could enable a break above thatlevel to test the next resistance at 42,981.
Alternatively, moving below 42,686 will favour the sellers to take control. The downward momentum will likely find the first support at 42,499. However, if the bears sustain control for a long period, it could strengthen the downward momentum to breach the first support. Also, that could invalidate the upside narrative and potentially take the price lower to test 42,354.
This post was last modified on Oct 14, 2024, 13:27 BST 13:27