Dow Jones: What Traders Are Watching

Summary:
• The Dow Jones futures trading higher for the third consecutive day as the sentiment has improved as the economic activity in the USA and Europe returns gradually to normality

The Dow Jones futures trading higher for the third consecutive day as the sentiment has improved as the economic activity in the USA and Europe returns gradually to normality. Investors will focus today on the ADP private-sector jobs estimate.

The ADP will give some clues on the upcoming NFP report on Friday. Analysts expect a loss of 21 million jobs. Also, the U.S. Treasury will announce the details of its quarterly refunding program while later on the day the EIA oil inventory figures will be watched, following the API estimate of an 8.4 million barrel build, the smallest since the end of March.
General Motors (G.M.) is trading higher in premarket after the company reported Q1 profit and revenue that fell, amid the coronavirus outbreak but beat consensus. Net income dropped to $294 million, or $0.17/share, from $2.16 billion, or $1.48/share, the previous year. Revenue declined over 6% to $32.71 billion but beat the expectations of $32.09 billion.

Meanwhile the trade talks between Great Britain and the U.S. begun yesterday via a videoconference call targeting a free-trade agreement. The U.K. – U.S. trading relationship is worth over $235 billion while the mutual investments valued at $1 trillion.

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Dow Jones Technical Analysis

Dow Jones ended 0.56% higher yesterday at 23,883 while the Dow Jones futures in premarket trading is 0.60% higher at 23,899. The short term positive momentum is alive after yesterday tested the 50-day moving average successfully and managed to rebound. The technical outlook remains bearish for the long term as the Industrial index trading below the 100 and 200-day moving averages. 

On the technical analysis side, first resistance for the Dow Jones stands at 24,169 the high from yesterday’s trading session. A break above might test 24,609 the high from April 30. The next resistance for the longer term is at 26,039 the 100-day moving average. 

On the other side, initial support for Dow Jones seen at 23,868 the low from yesterday trading session. Next support will be met at 23,275 the 50-day moving average. A credible break below will cancel the positive momentum and might open the way for a test of 22,922 the lows from April 21.