Dow Jones Industrial Average (.DJI) Rally Awaits Fed Chief Powell

Dow Jones Industrial Average (.DJI) Rally Awaits Fed Chief Powell

Dow Jones Industrial Average (.DJI) Rally Awaits Fed Chief Powell

Dow Jones futures were little changed early Wednesday morning, along with S&P 500 futures and Nasdaq futures, after Amazon stock and Facebook stock led Tuesday’s stock market rally. Along with the two FANG Internet giants, ServiceNow stock and Square stock claimed buy points. The current stock market rally is just below record highs. But on Wednesday, investors will focus on Fed chief Jerome Powell, with Fed rate cuts in the balance.

Late Tuesday, the U.S. announced a relaxation of its Huawei ban, following President Trump’s pledge on June 30 to do so. U.S. companies can supply the Chinese telecom gear giant if it doesn’t affect national security.

Meanwhile, Levi Strauss (LEVI) late Tuesday missed earnings views its second quarterly report since the Levi IPO debuted in March. Levi stock fell 7.4% in late trading. Levi stock had rallied 2.1% in Tuesday’s session and 13.4% over the last six sessions.

ServiceNow (NOW) has a best-possible IBD Composite Rating of 99. Amazon.com (AMZN) has a 97 Composite Rating, while fellow FANG stock Facebook (FB) holds a 95 CR. Square (SQ) has an 89 CR and Levi stock an 85.

Fed Chief Powell will speak before the House Financial Services Committee at 10 a.m. ET. Markets have fully priced in a quarter-point Fed rate cut with just a sliver of a chance for a half-point move. Powell could upend those expectations, but his testimony could have a bigger impact on expectations for Fed rate cuts in September and in the coming months.

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 26,185.04.

The projected upper bound is: 27,378.69.

The projected lower bound is: 26,197.89.

The projected closing price is: 26,788.29.

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 27 white candles and 23 black candles for a net of 4 white candles.

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 65.7236. This is not an overbought or oversold reading. The last signal was a sell 0 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 63.05. 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 sell 2 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 32. This is not a topping or bottoming area. The last signal was a sell 1 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 22 period(s) ago.

Rex Takasugi – TD Profile

DJ INDU AVERG closed down -22.650 at 26,783.490. Volume was 23% below average (neutral) and Bollinger Bands were 5% narrower than normal.

Open High Low Close Volume___
26,725.11926,807.69926,665.57026,783.490 218,330,304

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

Moving Averages: 10-period     50-period     200-period
Close: 26,719.34 26,074.33 25,482.43
Volatility: 7 15 20
Volume: 258,203,184 276,149,184 320,802,272

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 5.1% 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 18 periods.

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