US indices edged lower on Tuesday as markets took in a decline in US Housing starts and disappointing corporate earnings reports. Today pending home sales results will tell whether it will follow the theme of weakness in the housing sector and Fed Chairman Powell should continue yesterday’s testimony which was in line with his dovish stance in January while maintaining his outlook on a growing US economy despite softer data and a decelerating global economy. It is unlikely he will deliver information that will provide any more support for the bullish trend in US equities since the Fed’s dovish shift and investors will continue to monitor trade headlines to drive price action in the DOW index.
The DOW index made a modest decline of 0.13% to end at 26057. The RSI reading remains in positive territory and supported by the 50-midline separating the index from further downside pressure. Sustaining price above 26050 will indicate buying pressure and lead to a retest of the high at 26238, while a sustained move below 26050 suggests selling pressure with support found at the 50-period MA around 25910.
Support: 25950 / 25750
Resistance: 26240 / 26380