Dow Jones futures trading higher but in more cautious tone after yesterday the stocks close to all-time highs. Investors cheered robust US employment data, headlines of a potential vaccine for the coronavirus, and China’s announcement to cut tariffs on American imports.
Yesterday the ADP payroll data showed that the US added 291k jobs in January, smashing estimates as it was the biggest increase since May 2015. The Dow Jones index rallied to near pre-coronavirus levels. The S&P 500 made fresh record highs while Nasdaq also added in the green despite Tesla (TSLA) shares plunging 17%.
In Wall Street the Dow Jones futures are 0.41% higher. The Nasdaq futures are 0.44% higher at 9424 while the S&P 500 futures are 0.36% higher at 3347. Tesla yesterday gave up over 17% at $734.70. Today in pre-market trading Tesla is 0.87% higher at $741.06.
Dow Jones started the last two trading sessions gapping up indicating the strong momentum that drives stock prices. Traders have to be cautious at current levels as the coronavirus uncertainty will have a negative impact on global growth. On the technical side the outlook is clearly bullish for Dow Jones.
On the upside, initial resistance for the Dow Jones index will be met at 28,308.9 the high from yesterday’s trading session. Next resistance will be met at 29373 the all-time high.
On the flip side, initial support for the Dow Jones Industrial Average stands at 29000 the low from yesterday’s trading session. If the Dow Jones breaks below, then the next support stands at 28495 the 50-day moving average. The lower band of the Bolinger Bands would provide the next support at 28315.