The Dow Jones Industrial Average rose in its recent trading on the intraday levels, to achieve gains in its last sessions by 0.40%, gaining about 133.40 points. It settled at the end of trading at the price of 33,269.78, after its decline during Tuesday's trading by -0.03%.
The stock gains came after the December FOMC meeting minutes confirmed previous signals to policymakers that interest rates should continue to rise and remain stable at those high rates this year.
The officials also stressed that investors should not interpret the slower 50 basis point rate hike as a dovish pivot, warning markets against rate cuts this year.
Meanwhile, the purchasing managers' index data showed that factory activity in the United States contracted for the second month in a row, which increased investors' doubts that the central bank could maintain high borrowing costs without major damage. US to 48.4, its lowest level since May of 2020. Any number below 50% reflects a contraction in activity. Equity bulls were hoping to see data showing slowing economic growth, as this could allow the US central bank to slow down the pace of interest rate hikes.
Employment opportunities in the US fell slightly in November, confirming that the labor market remains strong, raising fears that the Federal Reserve may not be nearing the end of its monetary tightening cycle.
Dow Jones Technical Analysis
- Technically, the index is trying to regain its recovery considering its impact on the breach of a bearish corrective slope line earlier in the short term, as shown in the attached chart for a (daily) period.
- With the positive support for its trading above its simple moving average for the previous 50 days, in addition to that, it continues Positive signals in the relative strength indicators.
- This supports the hypothesis of the index's rise in its upcoming trading.
Therefore, we expect the index to rise in the short term, if it remains stable above the 32,582.00 support level, to target the 34,281.36 resistance level.
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