Record highs, the Global market rally seems to be taking effect for now as Asian markets overtake January highs as U.S earnings impress, and the new fiscal stimulus package is set to lead the road to recovery.
The Biden administration is set to spend close to $1.9 trillion to kick-start the U.S economy which has seen U.S bond yields higher and global investors load up on equities. U.S Futures are gaining momentum in early morning trade while the U.S Dollar (DXY) continues to lose steam.
The U.S Fed has indicated it would tolerate CPI rising above the benchmark inflation rate of 2% temporarily, which has seen investors speculating that interest rates could remain low. U.S CPI data will be released today at 15:30 SAST and Core CPI (YoY) is expected to increase to 1.5%.
Here is what’s expected this week:
The Wall Street 30 Technical Analysis
The Wall Street 30 has pushed higher after finding support at our 30506 level of interest and could reach our possible target price of 31595 before the week is out. Prices are driven higher by the Biden administration’s fiscal stimulus plans which will see Index prices even higher when implemented.
- The price action on the WS30 could move lower as market participants take profits ahead of the CPI data release and U.S market open later this afternoon. The WS30 price action over the last week seems to be very volatile at the open but finds buyers before the close into the Asian session which should be taken note off by traders.
- The WS30 is closing in on our possible target price at 31595 which could be reached before the end of the week.
- The 50-day SMA (blue line) is pointing higher and below price supporting the move higher.
- The Relative Strength Index (RSI) has pushed higher and is consolidating at overbought levels, which should not necessarily be construed as a signal to sell as overbought levels could remain on the RSI for weeks on end if a healthy trend is in place.
Chart Source: Wall Street 4H Timeframe - GT247 MT5 Trading Platform
Take note: The outlook and levels might change as this outlook is released during the current days (Wednesday the 10rd of February 2021) 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.
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.