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. See our updated Privacy Policy here.

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
Subscribe
Please try again
More View more
Real Time News
  • (ASEAN Fundy) US Dollar Forecast: Turning Point Reached? USD/SGD, USD/THB, USD/IDR, USD/PHP #USD $USDGSD $USDTHB $USDIDR $USDPHP https://www.dailyfx.com/forex/fundamental/article/special_report/2021/10/25/US-Dollar-Forecast-Turning-Point-Reached-USDSGD-USDTHB-USDIDR-USDPHP.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/87N97EGWdr
  • It’s important for traders to be familiar with FX spreads as they are the primary cost of trading currencies. Understand a pair's spread here: https://t.co/zEEUHZBx7g https://t.co/N2GqH7QoOd
  • RT @mkraju: Manchin signaling he’s open to $1.75T for social safety net bill, per source briefed on matter, but it’s unclear where the pric…
  • Further your forex knowledge and gain insights from our expert analysts @JohnKicklighter and @JStanleyFX on $USD with our free Q4 market analysis guide, available for free today. https://t.co/7G7pWntiyY #DailyFXGuides https://t.co/XYCRng3hEW
  • RT @JournalistRoss: From CNN's @mkraju: The goal among Democratic leaders is to have a vote Wednesday or Thursday on the infrastructure pac…
  • *Reminder: Weekly Strategy Webinar tomorrow at 8:30am ET on @DailyFX !! https://t.co/lxd5fZnn4H
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/L15w1dzclc
  • Wow Liverpool... https://t.co/9Mx6Xmw4iS
  • With the $SPX, Bitcoin and Fed 2022 rate forecasts pushing record highs; the heavy economic docket for the coming week will make for some loaded trading potential. The events and markets I'm looking at ahead: https://www.dailyfx.com/forex/video/daily_news_report/2021/10/23/SP-500-Reversal-ECB-Decision-FAANG-Earnings-Top-Volatility-Themes-Next-Week.html https://t.co/1SGirtalSb
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/Yl9vM7kO6a https://t.co/wdbXlx7ChB
S&P 500 and Dow Jones Stage Strong Rally as Dip Buyers Step In - Now What?

S&P 500 and Dow Jones Stage Strong Rally as Dip Buyers Step In - Now What?

Diego Colman, Market Analyst

S&P 500 AND DOW JONES TALKING POINTS:

  • S&P 500 and Dow Jones rally and wipe out most of Monday’s losses
  • Tech and financial-oriented companies lead the charge higher
  • Traders now await the September NFP report, which could influence the FOMC’s decision on when to taper assets purchases

Most read: Nasdaq 100 Nears One-Year Channel Support, Key Technical Levels to Watch

After a broad-based sell-off at the start of the week, U.S. stocks rebounded on Tuesday, led by technology and financials, as dip buyers stepped in to take advantage of the recent pullback and more attractive prices.

At the market close, the S&P 500 was up 1.05% to 4,346, while the Dow Jones climbed 0.92% to 34315, in both cases erasing most of the previous session's declines. Meanwhile, the Nasdaq 100 rose 1.4% to 14,674.15, bolstered by large gains in mega-caps, but was unable to recoup the bulk of Monday's losses as a big spike in bond yields added to concerns about elevated valuations.

On the day, sentiment was partially buoyed by impressive economic data that showed the ISM Non-Manufacturing PMI rose to 61.9 in September from 61.7 in August, two points higher than expected. The strong performance in the services sector reaffirms that the U.S. economy has not fallen off a cliff and suggests that consumer spending may be starting to recover as delta-variant anxiety subsides and Americans feel more confident to engage in high-contact activities (dining out and travel, for example). This is certainly a good outcome for stocks tied to the reopening, such as banks, cruise lines, airlines, and retailers, and may pave the way for a change in market leadership as we move through the final quarter of the year.

In any case, before jumping the gun, traders should keep an eye on the September payrolls (NFP) release due on Friday, as it may provide valuable information on the health of the labor market after its soft performance in August. Investors expect to see 473,000 new jobs, but anything above 300,000 may be enough to keep the Fed on track to taper asset purchases as soon as November. All in all, a good report should accelerate the transition to higher rates across the Treasury curve, boosting certain sectors such as financials and weighing down others such as technology and growth.

Check out the DailyFX economic calendar to make sure you don't miss any market-moving events

DOW JONES TECHNICAL ANALYSIS

The Dow Jones has rebounded moderately after finding support in the 33550-arealast week. However, for upside momentum to accelerate, the blue-chip index needs to pierce resistance near 34700 and break above the September 27 high (35000) decisively, invalidating the pattern of lower highs in place over the past eight weeks. If this move materializes, price could be on its way to test a short-term descending trendline near 35400.

On the other hand, if sellers regain control of the market and price turns lower, first support appears near 33800, followed by 33550. If the Dow falls below 33550, there could be room for a pullback towards the psychological 33000 level.

DOW JONES DAILY CHART

Wall Street Cash Index Four Hour Chart

EDUCATION TOOLS FOR TRADERS

---Written by Diego Colman, Contributor

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

DISCLOSURES