Dow Jones rises, but major support is under threat
After three sessions of correction in US equities, the Dow Jones is attempting a comeback.
The move comes in the shadow of what had been a heavily risk-on pre-FOMC environment, where expectations for rate cuts kept fueling a wave of optimism across markets.
The Nasdaq even strung together 12 consecutive sessions higher, while the Dow itself had been pressing toward new all-time highs.
Still, the mood has shifted: Equity Markets could be getting less optimistic regarding FOMC policy.
Even positive GDP data has been largely disregarded, with investors instead focusing on the decreased pricing of cuts further out into 2026 and a labor market that—judging by yesterday’s Jobless Claims beat—remains far from fragile.
With Jerome Powell expressing that the labor market would be more at the central picture in his Rhode Island speech on Tuesday, positive data would hence push out rate cuts further.
Today’s Core PCE release did send out further proof that inflation hikes would be more a temporary boost rather than a long-run change, reassuring the FED.
With this backdrop, the question now is whether the Dow’s latest bounce can hold or if major support levels are next in line to be tested.
Indeed, prices just reacted to a test of the upward trendline formed from the June lows but still aren’t showing the utmost bullish price action.
Explore this US 30 multi-timeframe analysis to spot what are the key technicals in play for upcoming trading.
