Dow Jones starts the session higher as six central banks announced joint action to help the provision of the liquidity of the dollar. Bank of Canada, Bank of Japan, Bank of England, European Central Bank, the Fed, and the Swiss National Bank said they would be using standing US dollar liquidity swap line arrangements. The central banks have agreed to increase the frequency of 7-day maturity operations from weekly to daily. These operations will start on Monday, March 23, and will continue at through the end of April.
IMF said that there are signs of recovery in China’s economy after the peak of infections has passed, although the risk of returning coronavirus cases remains high.
Coronavirus confirmed cases top 232,000 while death toll rises to 10,000, according to John Hopkins University. Meanwhile, California residents ordered to stay at home indefinitely in a bid to battle the coronavirus spread.
Dow Jones boosted by Travelers Cos. Inc. +8.53% at 93.40, McDonald’s Corp. +6.57% at 159.38, American Express Co. +6.47 at 82.03 and Chevron Corp. +4.39% at 59.85. The volatility index (VIX) of the CBOE is 13.55% lower at 58.44.
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Dow Jones Analysis
Dow Jones is 1.74% higher at 20420 as the rebound from December 2016 lows continues for the second day in a row. The technical outlook is still negative despite the two positive days, and further correction can’t be ruled out.
The Dow Jones intraday resistance stands at 20531 the daily high. If Dow Jones Index breaks above that level today the next level to watch is at 21,389 the March 17 high. In case of a move higher, the next resistance area stands at 21813 the high from March 16th.
On the flip side, the initial support level for the Dow Jones index will be met at 19,872 the daily low. If the Dow index breaks below, the next support stands at 19196 the low from yesterday’s trading session. More bids would emerge at 18913 the low from March 18th.
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