As the Dow Jones 30 continues to trade within vicinity of its all-time highs, concerns remain tangible for investors and short-term market conditions appear cautious. Early trading on future markets in the US for indices shows a potentially mixed opening. Congress, in the late hours of last night, was able to pass the large stimulus bill which keeps the US government open and promises to deliver more financial assistance to Americans.
However, while the approval of the stimulus may seem like it is capable of helping upside momentum today, it should be remembered that many investors already claimed their buying positions yesterday on the assumption that the bill would pass. A high testing the 30300.00 was attained on Monday, but then trading reversed slightly lower. However, before the higher values were achieved yesterday, it needs to be pointed out there was strong negative action in the Dow Jones 30 too.
The negative values yesterday, which took the Dow Jones 30 to a level of nearly 29,800.00 early, happened quite possibly as investors reacted to fears regarding the confirmation of an emerging mutated coronavirus striking the UK. This negative market opening, followed by the rise to higher terrain and then the rather polite selloff to end the day were clearly part of dynamic behavioral sentiment waves lashing through the markets.
Optimistic risk appetite is dueling with concerns stemming from rising fears of a potentially more dangerous wave from coronavirus. As the Christmas holiday approaches, it also throws a wrench into the markets because trading volumes will begin to diminish rapidly over the next two days, meaning volatility in the Dow Jones 30 could remain prevalent. While concern regarding the impact of the new coronavirus strain in the UK is considered, it is balanced rather well with the new stimulus bill passed by the US Congress, which leavse investors and speculators wondering about their future choices within the Dow Jones Industrials Index.
Trading the Dow Jones 30 should be done carefully near term. The index is certainly within its higher territory and has not suffered a massive selloff, which indicates that investors may stick around and add to their positions even in a marketplace which is considered over-inflated. Going into the holidays, lackluster trading volumes may cause rather interesting results too. It is difficult to time stock markets, but technically the Dow Jones 30 continues to demonstrate an ability to incrementally traverse higher via its dominant bullish trend and speculators may want to pursue buying positions near term after brief downward reversals which test support levels.
Dow Jones 30 Short-Term Outlook:
- Current Resistance: 30260.00
- Current Support: 30030.00
- High Target: 30300.00
- Low Target: 30000.00
