The Dow Jones index futures have seen a muted upside move this Monday as the US markets enjoy an extended weekend due to the Juneteenth holiday. A choppy end to the trading session on Friday following hawkish comments from Fed Chair Jerome Powell ensured that the Dow Jones index marked the third week of decline.
The Dow lost 4.72% last week after losing 4.48% and 1.07% in the two weeks prior to that. The fundamental trigger for the Dow’s correction was the larger-than-expected rate hike by the Fed, which has triggered a massive selloff on the US markets as investment flows shift toward money market instruments.
Furthermore, Powell reiterated the apex bank’s “acutely focused” commitment to contain soaring inflation. The comments sparked fears of a looming recession as credit conditions tighten. This week, the Fed Chair renders testimony before the Senate Banking Committee and the House Financial Services Committee. These testimonies could serve as additional catalysts for the Dow this week.
Dow Jones Index Outlook
The Dow Jones index found support at the 29670 price mark, with the accompanying bounce hitting resistance at the 30100 price mark. Failure to breach this resistance could lead to a resumption of the downtrend, targeting 28969 if the 29670 fails to hold up to bearish scrutiny. Additional targets to the south include 28184 and 27373.