DOW JONES UNSTABLE ABOVE MA5 ON EARNINGS & PMI
DJ 30 futures are currently trading at 24913- lower by 0.24% as compared to the previous close. The contract, however, closed in positive territory in the last trading session.
In the Cash Markets, the DJIA was down 0.26% at the time of writing. The broad-market index fell today as equities took a breather following a sharp rally on Wednesday. Declines in Microsoft and DowDuPont also pressured the index.
The major indices rose at least 1.55% on Wednesday after the Federal Reserve said it will be “patient” with raising rates moving forward. The central bank also said that its balance sheet would remain larger than previously expected.
Investors also monitored ongoing U.S.-China trade talks. Two sources told CNBC that U.S. and Chinese officials are talking about arranging a meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping for late February. This comes as U.S.-China trade officials meet in Washington on Thursday.
Index-member DowDuPont Inc (fell 8.03%) said today that sales were flat in its latest quarter as lower customer demand for its appliances and automotive products as well as the drop in oil prices weighed on the manufacturer’s top line.
Microsoft fell 1.58% after the company reported weaker-than-expected revenue and earnings that barely beat expectations on Wednesday. The tech giant also issued quarterly earnings guidance that was lower than expected.
On the other hand top gainers in the Dow Jones include Apple (up 1.5%), Merck & Co Inc. (up 1.5%), and Pfizer (up 2.5%) at the time of writing.
On the economic front, New Home Sales for November released earlier today came in at 657K. Sales were above the market expectation of 560K. In addition, the Chicago PMI for January released earlier today came in at 56.7 down from 63.8 in December. The PMI reading was also below the market expectation.
On the technical front, the RSI is currently at 63.24% and suggests that the market can move in the downward direction. The current price is above the MA5. The current price is above the middle line of the Bollinger Bands but is heading downwards.
Overall Bias is Negative and Short-term trades can be initiated with tight Stop Loss and Take Profit targets.
Trade Suggestion-Limit Sell At 24930, Take Profit At 24810 Stop Loss At 24990