Dow Jones Industrial Average (.DJI) highest levels in about six weeks ahead of a key Federal Reserve decision

Dow Jones Industrial Average (.DJI) highest levels in about six weeks ahead of a key Federal Reserve decision

Dow Jones Industrial Average (.DJI) highest levels in about six weeks ahead of a key Federal Reserve decision

The Dow and S&P 500 on Tuesday finished at their highest levels in about six weeks ahead of a key Federal Reserve decision, as President Donald Trump tweeted that he had a productive conversation with Chinese counterpart Xi Jinping.

How are benchmarks faring?

The Dow Jones Industrial Average DJIA, +1.35% rose 353.01 points, or 1.4%, at 26,465.54, putting the benchmark within 1.4% of its Oct. 3 all-time closing high, the S&P 500 index SPX, +0.97% advanced 28.08 points, or 1%, at 2,917.75, placing the index within 1% of its April 30 record at 2,945.83, while the Nasdaq Composite Index COMP, +1.39% climbed 108.86 points, or 1.4%, at 7,953.88, according to FactSet data.

The finish for all three benchmarks represented the highest closes since at least May 7, according to Dow Jones Market Data.

What’s driving the market?

U.S. President Donald Trump on Tuesday said over Twitter that there will be an “extended meeting” with President Xi Jinping of China at the Group of 20 meeting in Japan. Reports from Bloomberg News also confirmed a plan for the two leaders to meet on the sidelines of the gathering of developed global leaders.

The tweet comes after U.S.-Chinese trade talks had stalled, and there had been doubt over whether an additional 25% tariff on more than $300 billion in Chinese goods would go into effect soon, further escalating the protracted Sino-American trade confrontation, which has hobbled global markets.

Overall, the bias in prices is: Upwards.

The projected upper bound is: 27,059.38.

The projected lower bound is: 25,873.33.

The projected closing price is: 26,466.35.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 5 rising windows in the last 50 candles–this makes the current rising window even more bullish.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 68.9302. This is not an overbought or oversold reading. The last signal was a sell 4 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 65.29. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 10 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 104.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 4 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 8 period(s) ago.

Rex Takasugi – TD Profile

DJ INDU AVERG closed up 353.010 at 26,465.539. Volume was 4% below average (neutral) and Bollinger Bands were 47% wider than normal.

Open High Low Close Volume___
26,228.88126,527.18926,227.76026,465.539 273,485,888

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 26,013.46 25,992.79 25,436.12
Volatility: 9 15 20
Volume: 239,459,520 278,842,080 319,788,384

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

DJ INDU AVERG gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
DJ INDU AVERG is currently 4.0% above its 200-period moving average and is in an upward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .DJI at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on .DJI and have had this outlook for the last 4 periods.

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