The Dow Jones index is trading mostly higher today after opening with a bullish gap, as the US Initial Jobless Claims fell to +203K, just 10,000 higher than 50-year lows of 193K that were seen in April 2019. The figure was also less than last week’s numbers, which showed that 213,000 Americans applied for unemployment benefits. However, analysts are attributing the drop in the US Jobless Claims figure to the Thanksgiving Holiday. Declines were heaviest in California and Texas.
The number of Americans that turned in applications for unemployment benefits for the first time continues to show a US jobs market that is resilient. Investors on the Dow Jones apparently felt the same way and are responding positively to the news. The Dow has with today’s upside gap, reclaimed a good chunk of the value it lost on Monday and Tuesday as a result of the disappointing numbers seen in the ISM Manufacturing PMI report.
Dow Jones To Be Tested By Tomorrow’s NFP Report
The Dow Jones Industrial Average will face a stern test tomorrow when the Non-Farm Payrolls report is presented. Tomorrow’s figures are going to be a bit hard to call, as poor economic conditions around manufacturing and weaker-than-expected private sector hiring continue to present themselves as significant economic headwinds.
Price bounced on the 27353.4 price level and made its way further up with a bullish gap. This has taken the Dow to the next resistance seen at the 27688 price level (low of November 8/27). A break above this price level could see the Dow targeting the recent all-time highs that were seen above 28,820.
On the flip side, rejection at the current price level sees the Dow retesting 27353.4 support, with potential for a push towards 26675 if downside pressure continues.
The weekly chart shows a rising wedge which has so far, contained price action in the last several weeks. 26675 is where the lower border of this wedge will interact with the horizontal support. At this border, a decisive close below it could confirm the downside break of the wedge and open the door for a huge move to the south. Price recovery at 26672 will take the price to the opposing wedge border.More content