Tuesday, July 23, 2019

DOWJONES - 23 July 2019


Fundamental Highlights

US indices ended higher on Monday with the Dow being the underperformer as it traded 0.07% higher. The index struggled to keep pace with its counterparts as issues with Boeing’s 737 Max dragged its shares lower and in turn limited the Dow’s upside. Meanwhile positive sentiment stemmed from news reporting that the US and China should resume trade negotiations next week and hopes of trade progress. Moreover, while the extent of the widely expected rate cut remains indecipherable amidst conflicting comments from Fed members, the mere prospect of looser monetary policy continues to buoy market sentiment. Today the US publishes existing home sales data as markets gear up for a slew of earnings reports this week with a third of the Dow’s components reporting corporate results. Traders’ should look to earnings results to provide direction on the day, while monitoring any geopolitical or trade headlines to influence sentiment.

Technical Analysis

The Dow gained a modest 17 points to end at 27171 in a subdued trading session on Monday. Gains were limited by the resistance at the 20-period MA as the price failed to trade above it. Dow futures are pointing higher this morning and a sustained move through the 27220 resistance level would enable price to advance towards 27270 and 27330. Failure to hold above the 20-period MA would lead the Dow lower to test yesterday’s intra-day low at 27070 followed by 27050. Failure to hold above the 27050 level would lead the Dow towards the confluence of support provided by the ascending trend line from June 27th low and the 27000 level separating the index from negative territory.

Support: 27050/ 27000
Resistance: 27220/ 27330

Chart (H4)