Dow Jones Relief Rally Continue As Coronavirus Fears Fade
Dow Jones managed to rebound yesterday and finished 0.51% higher at 28399. Investor sentiment has improved as we don’t see any further escalation in the coronavirus spread, while the PBOC intervention in markets also helps the risk appetite.
The ISM Manufacturing Index came at 50.9 for January, beating last month’s figure, and also topping expectations. This positive data have helped assure investors that the U.S. economy is in good shape. The construction spending dropped 0.2% in December, below the analyst’s expectations. Later today, we will get a look at the monthly factory orders. The jobs data on Friday remains the more important economic report.
In Wall Street the Dow Jones futures are 1.03% higher at 28653. Nasdaq futures are 1.20% higher at 9223 while the S&P 500 futures are 1.04% at 3279. The Democrats chaos in Iowa during the primary election and rumours that President Trump’s impeachment would be over in 48 hours lifts the stock futures.
Dow Jones managed to rebound yesterday from 2020 lows. Today the futures pierced the 50-day moving average and the momentum turns positive again. If the Dow Jones cash market settles today above the 50-day MA resistance bulls will be back in the driver’s seat.
On the upside, immediate resistance for the Dow Jones index stands at 28,668 the high from yesterday’s trading session. Next resistance will be met at 28817 the high from January 31st. More offers might emerge at 29298 the high from January 24th.
On the flipside initial support fro the Dow Jones stands at 28319 the low from yesterday’s trading session. If the Dow Jones breaks below, then the bullish momentum would be cancelled. Bears will target the low from January 31st at 28171, which guards the December 13th low at 28025.