Dow Jones Industrial Average (.DJI) markets are still seeing a 100% probability of an interest-rate cut at the Federal Reserve’s next meeting

Dow Jones Industrial Average (.DJI) markets are still seeing a 100% probability of an interest-rate cut at the Federal Reserve’s next meeting

Dow Jones Industrial Average (.DJI) markets are still seeing a 100% probability of an interest-rate cut at the Federal Reserve’s next meeting

The U.S. labor market saw the best jobs growth of the year in June, but markets are still seeing a 100% probability of an interest-rate cut at the Federal Reserve’s next meeting, set for July 30-31, and these hopes are helping to drive stocks to record highs.

Despite Friday’s pullback in stock prices on the better-than-expected payrolls data, the blue-chip Dow DJIA, -0.16% ended the week up 1.2%, the S&P 500 index SPX, -0.18% was up 1.7%, and the Nasdaq Composite index COMP, -0.10% rose 1.9%, leaving all three benchmarks within striking distance of all-time highs.

“The jobs report is reassuring investors that the domestic economy is solid,” Alec Young, managing director of global markets research at FTSE Russell, told MarketWatch. Nevertheless, he still expects the Fed to cut interest rates as “insurance,” in case data on the U.S. economy start to take a serious turn for the worse.

U.S. payrolls increased by 224,000 in June, according to the monthly Department of Labor report released on Friday, recovering from May’s weak result of 72,000 jobs created, but employment growth in 2019 has averaged 172,000 jobs per month, well below 2018’s average of 223,000 per month, suggesting U.S. economic growth may be at least reverting to the mean after last year’s boost after the Trump tax overhaul in late 2017.

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 26,162.87.

The projected upper bound is: 27,520.53.

The projected lower bound is: 26,336.71.

The projected closing price is: 26,928.62.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.

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 89.2065. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 3 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 69.06. This is not a topping or bottoming area. However, the RSI just crossed below 70 from a topping formation. This is a bearish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 0 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 103.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 7 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 20 period(s) ago.

Rex Takasugi – TD Profile

DJ INDU AVERG closed down -43.881 at 26,922.119. Volume was 33% below average (neutral) and Bollinger Bands were 2% wider than normal.

Open High Low Close Volume___
26,867.75026,950.81126,733.33026,922.119 192,171,312

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

Moving Averages: 10-period     50-period     200-period
Close: 26,705.05 26,062.65 25,477.75
Volatility: 7 15 20
Volume: 286,736,288 279,777,088 321,110,784

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 is currently 5.7% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 16 periods.

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