S&P 500, Dow Jones Technical Forecast
S&P 500, Dow Jones Analysis and News
- S&P 500 | Bearish Divergence Leaves Index Vulnerable
- Dow Jones | Showing Signs of Exhaustion
Source: Thomson Reuters, DailyFX
S&P 500 |The index has managed to consolidate above the psychological 3000 level following the bounce from support at 2960-65. However, further gains in the index have been curbed by the rising trendline stemming from prior record highs, thus leaving the index vulnerable to a pullback. Catalyst likely to stem from next week’s FOMC decision, particularly the Fed are less dovish than what the markets expect. The RSI on the daily time frame continues to show a bearish divergence, further adding to the view that upside momentum may be somewhat exhausted. The key support zone is situated at 2960-65, in which a break below paves the way for a 2900 test.
S&P Price Chart: Daily Time Frame (Aug 2017 – Jul 2019)
DJIA | The index is beginning to show signs of exhaustion with the RSI closing below 60 and hitting its lowest level in over a month. Eyes will be on the weekly close, in which a close below last week’s low (27,068) may confirm that a near-term top has been set for the index. In turn, this leaves the Dow Jones vulnerable to a move towards the 26,600-26,650 zone. As a reminder, the Fed rate decision and comments by Chair Powell will be key next week.
Dow Jones Price Chart: Daily Time Frame (Jan 2019 – Jul 2019)
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--- Written by Justin McQueen, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.