Last week the US data surprised to the upside with
the ISM Services PMI and Jobless Claims beating
expectations by a big margin. The market didn’t like the strong data as it
raises the chances of another rate hike in November. In fact, the Dow Jones
sold off following the PMI beat with some consolidation thereafter, even after
the strong Jobless Claims. The market seems to be trading on “good news is bad
news” at the moment, but the outlook remains uncertain.

Dow Jones Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Dow Jones recently
sold off from the 35000 resistance but
bounced back near the upward trendline. The
major trend remains bullish, but the near term bias is bearish as the moving averages are
crossed to the downside. A break above the 35000 resistance will switch the
bias from bearish to bullish and should lead to more buyers coming into the
market taking the price to a new high.

Dow Jones Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that at the moment
we have some consolidation near the trendline as the economic data sends mixed
signals. The selloff from the resistance led to a moving averages crossover and
we might see the sellers leaning on the red 21 moving average here to position
for a break below the trendline.

Dow Jones Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the resistance zone around the 34650 level. This is acting as kind of a
barometer for the sentiment with the bias being more bullish above the level
and bearish below the level. In fact, we can expect the buyers to pile in if
the price breaks to the upside and position for a rally into the 35000
resistance and beyond. The sellers, on the other hand, are likely to step in
here with a defined risk above the resistance and target a breakout of the
trendline and new lower lows.

Upcoming Events

This week is likely to be a volatile one given the
release of top tier economic indicators including the US CPI. In fact, on
Wednesday we get the US CPI report, which is expected to show an acceleration
in the headline inflation but a deceleration in the core measure. On Thursday,
we get the US PPI, Retail Sales and Jobless Claims data. Finally, we conclude
the week with the University of Michigan Consumer Sentiment report on Friday.

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• Source: https://www.forexlive.com/technical-analysis/dow-jones-technical-analysis-watch-this-key-resistance-20230911/