The US equities market maintained a bullish momentum on Tuesday’s early session as the main indices hit new record highs. The Dow Jones Industrial Average reached a new all-time high after surging by 0.53% to trade at $32,953.5. At the same time, the S&P 500 rose by 0.65% to a new all-time high of $3,968.94 while Nasdaq Composite was up by 1.05%.
Airline stocks formed the top gainers. American Airlines and the United Airlines Holdings had their shares rise by 7.70% and 8.26% respectively. Following the signing of the $1.9 trillion stimulus package into law, investors are hopeful that travel bookings are on course to recovery. The optimism is further fuelled by the growing momentum of COVID-19 vaccination rollouts.
Investors are now keen on the FOMC meeting scheduled to start today. The culmination of the meeting will be Wednesday’s Fed decision on interest rates. While the monetary policy statement will likely remain unchanged, investors will focus on the bank’s tone with regards to inflation expectations.
Dow Jones technical outlook
Over the past four months, the index has formed an upward channel. By trading above the channel in the past few days, the rally is set to continue. Besides, it is trading above the 20 and 50-day exponential moving averages. At the same time, the index is slightly above the upper band of the Bollinger bands.
With the fundamentals supporting the technical indicators, I predict that the bullish trend will continue. Having hit a high of $32,973.4 in Tuesday’s early session, the next level to look out for is the psychological level of $33,100. If the index pulls back, it is likely to test the previous resistance level of around $32,150.
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Dow Jones chart
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