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
Bearish
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
Wall Street
Bullish
Gold
Bearish
GBP/USD
Bullish
USD/JPY
Bearish
More View more
Real Time News
  • Fed's Rosengren says the #Fed has been clear that negative interest rates are unlikely to be used
  • Back from vacation and back on schedule Going live for today's stock market webinar in 10 minutes - https://t.co/rmwDABTiN2 https://t.co/oC3Igu2muT
  • I've seen three more headlines today suggesting that there is significant money still on the sidelined despite the climb in markets. Is the assumption that some small tech milestone or new headline would excite investors to pay record amounts to get into a stretched market?
  • Forex Update: As of 14:00, these are your best and worst performers based on the London trading schedule: 🇨🇭CHF: 0.57% 🇪🇺EUR: 0.41% 🇨🇦CAD: 0.40% 🇳🇿NZD: 0.14% 🇬🇧GBP: -0.16% 🇯🇵JPY: -0.43% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/3mZjwCXcwc
  • Indices Update: As of 14:00, these are your best and worst performers based on the London trading schedule: FTSE 100: 2.39% France 40: 1.37% US 500: 1.29% Germany 30: 1.14% Wall Street: 0.97% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/3rljxp4YdZ
  • Heads Up:🇺🇸 Fed Kaplan Speech due at 15:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-08-12
  • Poll: What do you think set off Gold's sharp tumble yesterday - its largest single-day plunge since the April 2013 crash? Answering this question for yourself can help you decide whether this is a temporary waver or the impetus for a new trend.
  • Uber CEO says a temporary shutdown in California is possible according to CNBC $UBER stock price largely indifferent thus far
  • 🇺🇸 EIA Cushing Crude Oil Stocks Change (07/AUG) Actual: 1.336M Previous: 0.532M https://www.dailyfx.com/economic-calendar#2020-08-12
  • 🇺🇸 EIA Distillate Stocks Change (07/AUG) Actual: -2.322M Expected: 0.357M Previous: 1.592M https://www.dailyfx.com/economic-calendar#2020-08-12
Complacency Enters Into Dow Jones Industrial Average

Complacency Enters Into Dow Jones Industrial Average

2016-08-16 13:25:00
Jeremy Wagner, CEWA-M, Head of Education
Share:

Talking Points

-Dow Jones Industrial Average (DJIA) volatility suggests a complacent market that may sell off in the short term

-Fed rate hike expectations fail to inspire DJIA

-Medium term outlook remains bullish above 17,800

We have previously commented how the low volatility levels is leading to a complacent market. Complacent markets tend to eventually get rattled so the risk of a small sell off is mounting.

The inability of DJIA to punch meaningfully higher when the expectations for future rate hikes are slowly lessening hints that a sell off may be bubbling below the surface. The current expectation for a rate hike by the Fed during the December 2016 meeting is currently 39%. This is down a little over the past couple weeks.

In US30, a CFD which tracks the DJIA, there is a technical level near 18,700 that may be suppressing the advance. However, the technical picture is still medium term bullish and therefore a small sell off would not negate the medium term patterns.

Complacency Enters Into Dow Jones Industrial Average

Chart prepared by Jeremy Wagner

We would like to highlight a couple technical levels to keep an eye on. First, notice the purple dotted line above. Prices successfully broke above this line, then came back to test the same line on August 2. Above this line keeps the bulls quite comfortable.

In fact, so long as prices remain above 17,800, we can look for support to form on an eventual break higher towards 19,700. The 17,800 is derived from the blue upward sloping support line. Below 17,800 does not negate those bullish opportunities, but does begin to open the door to more immediate term bearish scenarios.

Bottom line, don’t let the near term noise distract from the medium term patterns. The medium term outlook remains for higher prices as we have been bullish DJIA since June 29 towards 19,700. Therefore, we’ll await lower levels to position towards the higher prices so as to generate a better risk to reward ratio.

Learn how leverage affects trading results in our Traits of Successful Traders research.

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

Good luck!

---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

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.