Dow Jones Futures Rebound – Apple, Amazon, and Facebook Earnings Boost Sentiment

The Dow Jones futures add over 80 points as the Industrial Average attempts a rebound from yesterday’s sharp losses. Better than expected corporate earnings reported from top technology companies after the closing bell yesterday, improved sentiment.

Facebook reported an 11% rise in revenue; Apple posted a stellar quarter, boosted by strong online sales during the coronavirus lockdown with revenue jumping 11%. Amazon (AMZN), also beat the consensus expectations. Alphabet also beat expectations but announced the first revenue drop in its history.

Today, Caterpillar reported earnings of $1.03/share, beating the consensus of $0.64. Merck reported a quarterly profit of $1.37/share, surpassing the expectations by 0.33/share. Chevron, on the other hand, reported a loss of $1.59/share, worse than expectations.

Yesterday’s losses in Dow Jones attributed to the disappointment from the GDP and unemployment data. The second-quarter U.S. GDP contracted by 32.9% slightly better than analyst’s expectations for a contraction of 34.1%. The Initial Jobless Claims rose for a second straight week and reached 1434K.

Fear and Greed Index Retreat to 61

The fear and greed index retreated yesterday to 61 after yesterday’s sharp losses in Wall Street and the dismal economic data from the U.S. economy. The Fear and Greed index was at 65 earlier in the week, while it was at 52 a month ago. 

The put/call ratio in CBOE is at 0.37, while the CBOE Volatility Index (VIX) or fear index finished 1.04% higher at 24.35.  

Dow Jones Futures Technical Analysis    

Dow Jones futures are 0.26% higher at 26,285 after it tested the 200-day moving average today and managed to rebound. There is a strong support zone that formed above the 50 and 200-day moving average. Yesterday the Dow futures bounced from the 200-day SMA and closed the session above. Same story today but the rebound started from the 50-day SMA. 

Bullish traders are looking for a break above 26,621, the high from July 28. More sellers would be met at 27,047 the top from July 23. On the other side, immediate support stands at 26,158 – the 200-day moving average. As I have mentioned above the next critical support would be met at 25,991, the 50-day SMA. A credible close below might challenge 25,333 the low from July 10. 

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Dow Jones Futures Daily Chart

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