Dow Jones Index Breaks Out Above 34,300 As US Stocks Extend Gains
Dow Jones Index gains 91 points ahead of a data-heavy week, with a key focus on the release of the CPI report for the month of October. According to consensus, a year-over-year inflation rate increase of 3.3% is expected to be reported on Tuesday, which is notably lower than last year’s 3.7%.
Investors will be eagerly waiting for the CPI report which is due on Tuesday after the Federal Reserve hinted that interest rates are likely to remain high. Furthermore, Fed Chair Jerome Powell has expressed concerns about the persistent threat of inflation, which may require interest rates to remain elevated for a longer period.
In my previous Dow Jones index forecast, I predicted a bounce towards 33,780 points due to the presence of a bullish divergence on the RSI and MFI indicators. This forecast has been perfectly met as currently, the benchmark index is sitting at 34,340 points.
The chart also shows the Dow Industrial Average is retesting the 34,245 points resistance level. If the index successfully flips this level into a support level, the bulls can anticipate a retest of the 35,629 level, which is the yearly high.