Optimistic market conditions saw the famed “BTFD” participants come to the fore once again, but as new COVID-19 infection cases rise across the globe could this be a bit premature from the bulls?

Asian shares slumped on Wednesday while the U.S Dollar (USD) found buyers as new worries that the fast-spreading coronavirus Delta variant could impact the global economic recovery. “The Delta coronavirus variant has for the moment displaced inflation as investors' primary source of concern, with South Korea on Wednesday reporting a daily record of new infections” - Andrew Galbraith.

One of the reasons for the renewed call for dip buyers across mainstream media to come out of the woodwork is that U.S Treasuries edged lower on Tuesday. The U.S 10-year yield rose to 1.2151% from the previous day while the 2-year Treasury increased slightly to 0.2037%.

Here is what’s expected this week:

The Wall Street 30 Technical Analysis

Our technical levels have held up well over the last couple of weeks and they are still in play, but we did however increase our possible target level slightly. We did discuss in our previous WS30 note the possibilities of retracements that materialized. Currently, with the mixed fundamental outlook, we could expect the price action to consolidate before we see a move in either direction.

• The WS30 price action is pushing higher, and we will be looking for an increase in volume to confirm the outlook. The adjusted possible target price is sitting at 35093 back at all-time-high levels as the first possible target price.
• The 50-day SMA (blue line) is acting as resistance to price on the 4H chart. We need the price to move higher from here or we could expect a short-term pullback.
• The Relative Strength Index (RSI) is consolidating above the 50 levels on the 4H chart.

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 21^st of July 2021) U.S Market open.

Sources – MetaTrader5, Reuters, Andrew Galbraith.

Barry Dumas | Market Analyst at GT247.com

Barry has 12 years of 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.

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