News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Bullish
Wall Street
Mixed
Gold
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bullish
USD/JPY
Bearish
More View more
Real Time News
  • #Crudeoil prices could reverse lower as the #OPEC Monthly Oil Market Report (MOMR) forecasts fading global demand and oversupply concerns. Get your #commodities update from @DanielGMoss here: https://t.co/G02ajeLPqZ https://t.co/THuauT4XQ9
  • The outlook for the $EURUSD pair has worsened after its failure to move back to the high just above 1.20 touched on September 1 despite the #ECB’s decision earlier this month not to talk down the Euro. Get your #currencies update from @MartinSEssex here: https://t.co/kDCHxHgGlU https://t.co/Li4jHqaNdC
  • #USDollar Outlook Bearish on Mnuchin & Powell Testimonies, Key US Data ⬇️ https://www.dailyfx.com/forex/fundamental/forecast/weekly/usd/2020/09/20/US-Dollar-Outlook-Bearish-on-Mnuchin-Powell-Testimonies-Key-US-Data.html
  • The London trading session accounts for around 35% of total average forex turnover*, the largest amount relative to its peers. The London forex session overlaps with the New York session. Learn about trading the London forex session here: https://t.co/UTWxbnNz7M https://t.co/fuWSUDE1pT
  • The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Learn more about the Fed here: https://t.co/ADSC4sIHrP https://t.co/eRTdlhAOFN
  • The Japanese #Yen may continue to exhibit a bullish behavior as the Bank of Japan (BoJ) appears to be in no rush to alter the path for monetary policy. Get your #currencies update from @DavidJSong here: https://t.co/HFjc6KGzRw
  • The New Zealand Dollar appears poised to extend its climb against its haven-associated counterparts as long-term trend break hints at cyclical upturn. Get your $NZDUSD market update from @DanielGMoss here: https://t.co/CPxP1Q8B6d https://t.co/n2wESiqnpJ
  • The US Dollar may rise against ASEAN currencies like the Singapore Dollar if local retail sales and sentiment data disappoints. USD/IDR may fall on the Bank of Indonesia. Get your market update from @ddubrovskyFX here:https://t.co/HpH8pXFdLl https://t.co/laHmaZXpJe
  • The US Dollar may rise against the Singapore Dollar and Philippine Peso. USD/MYR’s downtrend holds, but a bullish pattern brews. USD/IDR seems stuck between key technical levels.Get youe #ASEAN currencies market update from @ddubrovskyFX here:https://t.co/TF6DRVp6kX https://t.co/WEtxkdSwxD
  • There are three major forex trading sessions which comprise the 24-hour market: the London session, the US session and the Asian session. Learn about the characteristics of each session here: https://t.co/UVvf51HiVP https://t.co/4wlRjBTCzK
Dow Jones Industrial Average Yawns after FOMC

Dow Jones Industrial Average Yawns after FOMC

2016-07-28 13:20:00
Jeremy Wagner, CEWA-M, Head of Education
Share:

Talking Points

-Dow Jones Industrial Average (DJIA) continues to consolidate near all-time highs

-Fed rate hike expectations remain unchanged, therefore nothing is pushing the market at the moment

-A technical correction to 18,167 area cannot be ruled out and would be normal within the context of this up trend

Dow Jones Industrial Average continues its consolidation near recent all-time highs. As we stated on Tuesday, this appears to be a technical correction that is anticipated to be shallow.

The Fed was unable to wake the market participants, mostly because they didn’t present anything new. Fed futures still suggest about a 48% chance of a rate hike in December 2016 which is little moved from the reading prior to yesterday’s rate announcement.

On Tuesday, we highlighted 2 levels that may offer support if prices continue to drift lower. In US30, a CFD which tracks the DJIA, a move lower to 18,365 (May 19, 2015 high) or 18,167 (April 20 high) cannot be ruled out.

Dow Jones Industrial Average Yawns after FOMC

Chart prepared by Jeremy Wagner

Tuesday afternoon, DJIA did fall to 18,387 which is just above the first level. The subsequent bounce higher from Tuesday has been feeble while lacking momentum. That suggests prices may continue to drift lower and actually touch 18,365 or 18,167.

From a sentiment perspective, the number of short traders are 10% below last week’s levels while the number of longs are 23% above last week. This has shifted SSI slightly more positive and now sits at -6.4. SSI is a contrarian type of indicator such that when it shifts positive, look for prices to dip. (Learn how to trade with SSI here.)

Though the short term outlook appears boring, the medium term outlook remains bullish towards 19,700. If price momentum begins to dig down into 17,800, then we’ll reconsidered the higher probability patterns. In the short term, we’ll focus on lower levels of 18,365 or 18,167 to buy the dip.

Day traders for DJIA can follow the Grid Sight Index (GSI) for intraday momentum swings. GSI is a big data indicator which analyzes millions of price points and thousands of trend components in real time to determine how many historical patterns match up to the current price action. The results show how previous patterns have behaved, though past performance is not indicative of future results.

Check out US30 on ‘m3’ or ‘m5’ via GSI here.

Interested in a longer term outlook for equities? Download our quarterly forecast here.

Good luck!

Suggested Reading:

All Time Highs are Hard Work

Dow Jones Industrial Average Punches Back After Brexit Collapse

Do your losing trades overshadow your winning trades? Learn about the psychology behind why that might be happening in our Traits of Successful Traders research.

---Written by Jeremy Wagner, Head Trading Instructor, DailyFX EDU

Follow me on Twitter at @JWagnerFXTrader .

See Jeremy’s recent articles at his Bio Page.

To receive additional articles from Jeremy via email, join Jeremy’s distribution list.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES