The U.S markets have been on a wild ride over the last couple of hours which filtered through to a very choppy Asian session during early morning trade on Wednesday.
U.S markets moved lower in the last hour during Tuesday’s session as uncertainty ran rampant as Republicans and Democrats still debate the relief package. The Republican leader’s comments that there had been now talks on the stimulus package since Friday prompted the markets to react.
Positive COVID-19 vaccine news surfaced out of Russia with the country becoming the first to grant approval for a vaccine after less than 2 months of human testing. Nevertheless, the news spurred on hopes that other vaccines in development could also become available earlier than expected. These hopes saw commodities like Gold and Silver lose their shine as investors rotated back into equities.
The Wall Street 30 Technical Analysis
The price action on the Wall Street 30 did indeed stay above the 50-day SMA, supporting the move higher as highlighted in our U.S. Non-Farm Payrolls (NFP) release – 7 August 2020 note. Great news as our 3rd target price at 28123 was reached yesterday. The move higher was also supported by positive NFP Jobs number which saw positive sentiment filter through to the market.
Technical points to look out for on the Daily Wall Street 30:
- The price action did indeed stay above the 26721-support level of interest (pink line) which saw our 28123 possible target level reached.
- The 50-day SMA (blue line) is still pointing higher supporting the current higher price move.
- The Relative Strength Index (RSI) is above the 50 level and has reached the overbought level which is very positive for the move to continue.
Chart Source: Wall Street 30 Daily Timeframe - GT247 MT5 Trading Platform
Technical insights – what the Beef is looking at now
The rising wedge price formation that developing did not playout and was negated by the price action moving out of the triangle price pattern. This might be seen by technicians as very positive news as this might imply a higher rate of success for prices to move even higher.
This outlook should be supported by a possible retest of the price pattern and the Relative Strength Index (RSI) staying above the 50 and in overbought levels.
The Wall Street 30 has been lagging the Nasdaq and the S&P 500 in moving above and towards previous all-time highs respectively which brings our next possible target price of 29390 into focus. The target level will also coincide with the 100% Fibonacci retracement.
Chart Source: Wall Street 30 Daily Timeframe - GT247 MT5 Trading Platform
Take note: The outlook and levels might change as this outlook is released prior to the current day (Wednesday the 12th of August 2020) U.S Market open.
Sources – MetaTrader5, Reuters
Barry Dumas | Market Analyst at GT247.com
Barry has 12 years experience in the financial markets. He enjoys educating clients on trading / investing and providing punchy technical analysis on securities. He currently holds a Wealth Management qualification and is studying towards becoming a Chartered Market Technician® (CMT) designation holder.
Disclaimer:
Any opinions, news, research, reports, analyses, prices, or other information contained within this research is provided by Barry Dumas, Market Analyst at GT247 (Pty) Ltd t/a GT247.com (“GT247.com”) as general market commentary, and does not constitute investment advice for the purposes of the Financial Advisory and Intermediary Services Act, 2002. GT247.com does not warrant the correctness, accuracy, timeliness, reliability or completeness of any information which we receive from third party data providers. You must rely solely upon your own judgment in all aspects of your trading decisions and all trades are made at your own risk. GT247.com and any of its employees will not accept any liability for any direct or indirect loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from use of or reliance on the market commentary. The content contained within is subject to change at any time without notice.
