Dow Jones Industrial Average (.DJI) Outlook
The Dow Jones futures trading higher on memorial day as investors ignored rising tensions between USA and China and a new stand-off in Hong Kong and centered on the reopening of the economy and developments on the coronavirus treatment.
Fed Governor Rosengreen in an interview on Sunday, said that the Federal Reserve is expected to start lending cash to small and medium-sized companies. the size of the program is about $600bn and targets the SME sector. Rosengreen also added that there’s a major risk that unemployment would stay at double-digit levels during 2020 and monetary and fiscal support had to continue to avoid a more severe impact in the United States labour market.
On Friday, the Dow Jones managed to reverse the morning session losses and finished almost unchanged helped by Apple, Cisco Systems and Intel corp.
In Europe, the stock markets trading higher, getting a hand from better than expected IFO business climate data. The IFO Business Climate in Germany came in at 79.5, beating the forecasts of 78.3 in May. This Assessment came in at 78.9 below the expectations of 80. The IFO Expectations came in at 80.1, topping the expectations of 75. The Germany Gross Domestic Product (GDP) for the first quarter of 2020 came in at -2.2% in line with forecasts whereas the yearly Gross Domestic Product reading also matched expectations at -1.9%.
Price Performance
Top Movers
Bottom Movers
Shayne Heffernan Trade Idea
“You can’t justify the rally right now from a fundamental perspective.”
Technical Analysis
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 24,764.25.
The projected upper bound is: 27,025.26.
The projected lower bound is: 22,035.64.
The projected closing price is: 24,530.45.
Candlesticks
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 25 white candles and 25 black candles.
A doji star occurred (where a doji gaps above or below the previous candle). This often signals a reversal with confirmation occurring on the next bar.
A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).
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 84.0100. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 8 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 55.68. 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 42 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 70. This is not a topping or bottoming area. The last signal was a sell 0 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 2 period(s) ago.
Rex Takasugi – TD Profile
DJ INDU AVERG closed down -8.959 at 24,465.160. Volume was 46% below average (neutral) and Bollinger Bands were 63% narrower than normal.
Open High Low Close Volume 24,461.980 24,481.641 24,294.070 24,465.160 255,663,984
Technical Outlook Short Term: Overbought Intermediate Term: Bearish Long Term: Bearish
Moving Averages: 10-period 50-period 200-period Close: 24,086.49 22,919.36 26,312.50 Volatility: 33 74 46 Volume: 400,110,208 518,328,448 351,923,168
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 7.0% below its 200-period moving average and is in an downward trend. Volatility is relatively normal 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 bearish on .DJI and have had this outlook for the last 5 periods.
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