Dow Jones Technical Analysis: Rises in a volatile session – 15 September 2022

The Dow Jones Industrial Average rose slightly in its recent trading at the intraday levels, to achieve slight gains in its last session. The index went up by 0.10%, to gain about 30.12 points only, to settle at the end of trading at the price of 31,135.10. It previously declined in trading on Tuesday by -3.94%, the largest percentage loss since June 2020, at the height of the coronavirus pandemic.

The producer price index fell 0.1% in August after a 0.4% drop in July, in line with the 0.1% drop expected in a survey compiled by Bloomberg. After excluding the more volatile food and energy prices, the core PPI rose 0.4%, above the expected 0.3% increase and after rising 0.3% the previous month.

This comes after the sudden increase in the CPI reading and the rise in core prices for the month of August sent stocks down significantly on Tuesday.

Disappointing core CPI data for August means the Fed will raise the interest rates by 75 basis points, with a possible 50 basis points in November.

Technically, the index’s rise came in a session characterized by volatility, because of the stability of the main 31,000 support level.This provided the index some positive momentum that gave it an opportunity to compensate for part of the losses it had incurred in its previous session, considering the dominance of the short-term bearish trend along a slope line.The negative pressure of its trading below the simple moving average for the previous 50 days continued, in addition to that, we notice the start of negative signals again on the RSI indicators.

Therefore, our expectations indicate more decline for the index during its upcoming trading, especially in case it breaks the 31,000 support, to target the pivotal 29,653.30 support level.

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