Dow Jones Index Analysis
Dow Jones Fundamentals
The Dow Jones Industrial Average rose 0.02% on Friday, while futures tracking the S&P 500 and Nasdaq rose approximately 0.4%, driven by Intel earnings and as investors prepared for a key inflation report that could fundamentally alter the trajectory of US interest rates.
Global markets were slightly calmer on Thursday after the White House confirmed that US President Donald Trump will meet with Chinese President Xi Jinping next week during his Asia tour.
The long-awaited meeting between the two leaders comes amid escalating trade tensions that have kept investors on edge. Reciprocal tariffs and export restrictions have dented investor confidence in recent weeks.
News of the meeting offered a glimmer of hope for a de-escalation of tensions.
On the other hand, with the US government shutdown since the beginning of the month, much economic data, including jobs data, has been withheld, raising growing concerns among Federal Reserve officials.
All eyes are on the core CPI figures, due out one hour from now, which are expected to remain unchanged at 3.1%. This is likely to be the only indicator of inflation ahead of the Federal Reserve's interest rate decision next week.
Investors have already priced in a 25 basis point cut, with another cut expected in December. But the sudden spike in the core CPI, which is still being reported despite the government shutdown to enable the Social Security cost-of-living adjustment, could jolt markets that are already oscillating without a clear direction.
The Dow Jones Technically
The Dow Jones rose slightly today, attempting to form a harmonic bat pattern on the hourly timeframe. The 46,800 level is considered a good level to sell the index cautiously with minimal risk, given the upcoming important data release.
The divergence indicator on the hourly MACD is negative.
We anticipate targets for this decline near the 46,500 level as an initial target, followed by the 46,000 level and finally the 46,700 level upon completion of the harmonic pattern.
This scenario fails if the 47,200 level is breached upwards.
