The “Tweet Storm” has returned and U.S markets reacted in the sharpest drop in two weeks, after U.S President Trump cancelled talks with Democrats on the stimulus plan. The president’s Tweet stated that negotiations on coronavirus relief will stop until after the elections.
Asian Markets shrugged off Trumps tweets and the MSCI’s broad based index of Asia Pacific shares gained 0.4% to a two-week high while U.S Futures gained momentum Wednesday morning.
The Wall Street 30 Technical Analysis
The price action stayed above the 27155-support level and as discussed in our U.S. Non-Farm Payrolls (NFP) note, price had to move higher to negate the formation of a downtrend.
Price gained momentum after positive stimulus news last week which saw the price action rise to our 28123-resistance level, which needs to be crossed for another leg higher.
If the market cannot shrug off President Trumps outlook and comments on stimulus, then we might see the price action back at the 27155 support soon.
Technical key areas to keep an eye on - WS30 Daily Chart Timeframe
- The price action needs to close above the 28123-resistance level to support a move higher to our third possible target price of 29390.
- The 50-day SMA (blue line) is supporting price currently and pointing higher.
- The Relative Strength Index (RSI) has broken out of the downtrend and is above the 50 level which will be watched closely.
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 7th of October 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.
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