Dow Jones Index Outlook Ahead of Retail Sales Data, Powell Speech

The Dow Jones Index futures are up 1.36% on the day. This points to a higher open for the index as traders await a triple dose of data on this trading day. The upside move puts the Dow on a positive end for the third day, even as it has shed some earlier gains.

The Dow Jones index could see some volatility as three potential fundamental triggers line up. First is the headline and core retail sales numbers coming up at 8.30 am EST. The forecast is for retail sales to have improved from 0.5% to 1.0%, with the core component (ex. automobiles) declining from 1.1% to 0.4%. 

Next comes the Industrial Production and Capacity Utilization data, with industrial production expected to slow from 0.9% to 0.4%. Finally, perhaps the most crucial trigger for the Dow Jones index is the discussion on inflation by US Fed Chair Jerome Powell at an event organized by the Wall Street Journal in New York. Traders would be searching Powell’s responses and comments for any hint of future action by the Fed. 

Dow Jones Index Outlook

The violation of the resistance at the 32464 price mark requires a price/time filter confirmation. If this breakout is confirmed, 33195 (24 January low and 2 May high) becomes the primary barrier to the north. A further advance targets the 11 March high at 33621, with 34156 (26 April and 4 May highs) forming an additional target to the north if the bulls uncap 33621. 

On the flip side, a decline below the 32464 support puts the 31282 support level (12 May low) under pressure. If this support collapses under selling pressure, the next target to the south will come in at 30100 (5/29 January 2021 lows). The 15 January and 4 March lows form a potential pitstop at 30627. Only when the bears push past this pivot can they turn 30100 into a potential harvest point.  

Dow Jones: Daily Chart