Tuesday, September 24, 2019



Fundamental Highlights

Major US indices ended lower on Monday with the exception of the Dow which managed to barely rise by 0.06%. Economic data provided little support on the day as weak manufacturing PMI data out of Europe overshadowed better than expected manufacturing figures out of the US and raised concerns over slowing global growth. Moreover, lack of progress in the US-China trade situation keeps risk appetite subdued and leaves the trade situation at the forefront of market concerns. Today, the US publishes CB consumer confidence figure for September which is expected to decline. Apart from the data, markets should continue monitoring trade headlines as it remains a key driving force of price action.

Technical Analysis

The Dow made a marginal gain of 14 points to end at 26949 on Monday. The price initially dropped below the 26880 level to find support at 26800 before bouncing higher towards the 27000 level. Dow futures are pointing higher this morning as price reached the resistance at 27100 near the 50-period MA to mark another high as the index is seen trending lower since recording a high of 27268 last week. Failure to trade above the 50-period MA would maintain selling pressure while a sustained move below the 27000 level is required to indicate further weakness is in store for the Dow. It is worthy to note that the daily RSI reading has remained in bullish territory for most of the month and a drop below the 26800 level near the 20-day MA would signal a bearish phase for the Index and lead it to lower support levels at 26720 and 26660.

Support: 26880/ 26800
Resistance: 27100/ 27190

Chart (H4)