The Dow Jones Industrial Average is up strongly this Friday as a better than expected Non-Farm Payrolls report boosted investor confidence in the US markets. An addition of 266K jobs and a reduction in the unemployment rate to 3.5% (versus an addition of 181K and an unemployment rate of 3.6% as analysts had predicted) was enough to push the Dow Jones up to touch off the 28,000 mark as at the time of writing.
Today’s surge of more than 300 points so far, has positioned the Dow on the pathway towards another attempt at the recent all-time highs. This is the largest gain in jobs in nearly 10 months and adds some validation to the third interest rate cut by the Fed last month, which has enabled hiring to improve even in the face of dwindling economic conditions around manufacturing. Michael Arone, who is State Street Global Advisors’ Chief Investment Strategist calls this a “very solid report” which should calm any immediate fears of a recession.
The Dow found support yesterday at my identified support price of 27353.4 (blue dotted line), and has been able to push up within the context of the rising wedge pattern on the weekly chart. Price continues to oscillate within the borders of this wedge, and this latest push from a strong fundamentally bullish indicator has allowed the Dow recover all what it lost on Tuesday and push for the upper border of the wedge, where the previous all-time high is found.