2023/05/04 (223.086) Technical Analysis

DOW Future

The Last Bullish GAP From August 2022 Must Be Defended By Us Bulls,
Because A Price Action Below Manifests A Failed Breakout Attempt In Retrospect

At this point, us inflation was at its peak. Which of course we didn’t know at the time. And why the Dow Jones Industrial Average Index, after the high of the breakout at 34281.36 points on 08th August 2023, fall back until on October 13th 2022, and traded new lows at 28660.94 points.

In November 2022, the Dow Jones Industrial Average Index was then traded above the GAPS again for the first time.
33130.63 (daily low of 08/10/2022) and/or 32877.53 (daily high of 08/09/2022) – more precisely on 10/11/2022. And while this GAP was defended in December 2022, January 2023 and/or February 2023, investors and/or traders traded the Dow Jones Industrial Average Index below it again for the first time in March 2023. So, from a technical analysis point of view, a short-term technical reversal pattern formed. And that´s why I formulated even this long Technical Analysis 4XSetUp for the DOW JONES Future, by the way I even formulated it. Because the fight of the bulls and/or bears for the price action between 33130.63 points & 32877.53 is something like a front line for me. Because the short-term bullish trend reversal formation, below the GAPS, from March 2023 is opposed by a medium-term bearish trend reversal formation, just since November 2022. This is the technical picture that I currently perceive in the Dow Jones Industrial Average Index. And that’s why I pay attention to the lower price action brands around 32948.93 points, 32812.33 points, 32573.43 points and or also 32500.73 points. Which are below the GAPS. In retrospect, however, it was something like low prices, what you can see in the daily charts, with the help of the pivot points. These brands must be defended. At which level we more or less entered our long 4XSetUp in the DOW JONES Future.

This Is The Medium-Term And/Or Short-Term Basic Technical Scenario, If I Am Not Mistaken
– Regardless Of This Technical Analysis, Let’s Get A Quick Detail Overview At Today’s Price Action On The WallStreet

The difficulties and price slumps in the US banking sector are not coming to an end and spoiled investors’ appetite for shares on Thursday. Double-digit price falls at several regional banks ensured that the leading US index, the Dow Jones Industrial, continued its recent weakness. The index fell 0.86 percent to 33,127.74 points, falling to its lowest level since late March. In the first four days of May, the Dow lost almost three percent. The day before, another rate hike by the US Federal Reserve had weighed on the US stock exchanges. The market-wide S&P 500 fell by 0.72 percent to 4061.22 points. The Nasdaq 100 held up a little better with a minus of 0.37 percent to 12,982.48 points because the banks do not play a major role in the technology-heavy stock market barometer. The papers of the bank Western Alliance collapsed by almost 40 percent. According to a report in the Financial Times, the Phoenix, Arizona-based bank is considering selling part or all of its business. The bank has since denied the report, saying the statements made there were “absolutely wrong.” Los Angeles-based bank Pacwest is also considering strategic options, including a split or capital increase, according to those informed, Bloomberg reported. The price then fell by more than 50 percent to a record low. First Horizon’s shares fell by a third after the lender and Canada’s Toronto Dominion Bank called off a proposed $13 billion merger. On the other hand, shares in Toronto Dominion Bank, which are listed in New York, rose slightly. “The acute phase of the turbulence in the banking sector does not seem to be over yet and politicians need to understand that,” warned Krishna Guha from Evercore ISI. The problem of the institutions concerned is that the possibilities of a rescue are limited. In the banking sector, which is heavily counted, the papers of large institutes could not escape the downward pull. Goldman Sachs, Wells Fargo, Bank of America and Morgan Stanley suffered above-average losses – and weighed on the major stock market indices.

To Get A Better Feel For The US WallStreet And Not Just Via Our Long 4XSetUp In The DOW Future,
You Know That I Always Take Into Account The Price Action Of The US Dollar, Especially About The USD Index

DXY Recovers From 2-Day Loss
The dollar index recovered to 101.5 on Thursday, following two days of losses, as investors processed the latest economic data and monetary policy decisions ahead of the monthly jobs report on Friday. The Federal Reserve raised interest rates by 25 bps as anticipated but removed language in its policy statement that suggested additional rate hikes were forthcoming. However, Fed Chair Jerome Powell clarified that the committee is not currently advocating for rate cuts based on their inflation outlook. Economic data revealed that weekly claims surpassed expectations and that US companies cut the fewest jobs in April compared to the rest of the year, while unit labor costs in Q1 accelerated more than expected. On Friday, investors await the monthly jobs report, which is expected to indicate the creation of 180K jobs in April, the lowest since December 2020. Meanwhile, the ECB raised rates by 25 bps, signaling a slower pace of tightening after three consecutive hikes of 50 bps.

US Stocks Slide In Banks Crisis
The Dow closed more than 280 points lower on Thursday afternoon, while the S&P 500 and Nasdaq 100 dropped 0.7% and 0.5%, respectively, as worries about banking system stress and a possible Fed-induced recession lingered. Shares of PacWest plunged 50.6% after reports that the California-based bank has been considering strategic options, including a potential sale. Other regional banks also came under heavy selling pressure, including Western Alliance (-38.4%) andZions Bancorporation (-12%). On the policy front, the Federal Reserve raised interest rates by 25 basis points on Wednesday while signaling a possible pause in its tightening cycle. However, Fed Chair Jerome Powell’s view that inflation remained a concern, creating uncertainty among investors regarding the central bank’s future monetary policy. Meanwhile, the ECB announced a widely expected 25bps hike while warning about further rate increases to address inflation.

Whatever The Price Action In The US Was Today, There Were Also Some Fresh US Economic Data
That I Don’t Want To Withhold From You At This Point, So That We Can Get A More Detail Overview About The US Economy

US Imports Fall for 2nd Straight Month
Imports to the United States experienced a second consecutive month of decline in March 2023, falling by USD 1.1 billion to reach USD 320.4 billion. This drop reflected weakening domestic demand, likely caused by the cost-of-living squeeze. Imports of goods decreased USD 1.2 billion, led by lower purchases of capital goods, including semiconductors, electric apparatus, and excavating machinery. Additionally, imports were down for industrial supplies and materials thanks to falling purchases of other petroleum products, fuel oil, organic chemicals and crude oil. On the other hand, consumer goods imports rose due to pharmaceutical preparations and other textile apparel and household goods. Finally, imports of services were up USD 0.1 billion, boosted by travel.

US Exports Rebound in March
Exports from the United States increased by USD 5.3 billion from a month earlier to USD 256.2 billion in March 2023. This surge, up from the revised figure of USD 250.9 billion the previous month, indicated a rebound in external demand as inflationary pressures across the globe started to ease. Exports of goods were up USD 5.2 billion mainly due to sales of industrial supplies, in particular crude and fuel oil, and natural gas. In addition, sales of vehicles also increased. Exports of services rose USD 0.1 billion, boosted by travel.

US Trade Gap Lowest In 4-Months In March
The US trade gap narrowed to a four-month low of $64.2 billion in March of 2023 from $70.6 billion in February, compared to market forecasts of a $63.3 billion gap. Exports went up 2.1% to $256.2 billion, prompted by sales of crude oil, fuel oil, natural gas, passenger cars and travel while sales fell for nonmonetary gold and transport. Meanwhile, imports edged 0.3% lower to $320.4 billion, with purchases falling for semiconductors, electric apparatus, excavating machinery, crude and fuel oil, organic chemicals and sell phones and other household goods and transport. On the other hand, imports went up for finished metal shapes, pharmaceutical preparations and travel. Considering Q1, the goods and services deficit decreased $77.6 billion, or 27.6% from the same period in 2022. Exports increased $61.4 billion or 8.7% and imports decreased $16.2 billion or 1.6%.

US Initial Jobless Claims Rise More Than Expected
The number of Americans filing for unemployment benefits rose by 13 thousand to 242 thousand on the week ending April 29th, surpassing market expectationsof 240 thousand. The result compounded recent data that points to a marked softening of the US job market, caving to a prolonged series of aggressive interest rate hikes by the US Federal Reserve. The four-week moving average, which removes week-to-week volatility, rose by 3,500 to 239,250.

US Labor Costs Rise More than ExpectedUnited States Labour Costs
Unit labor costs in the US nonfarm business sector rose an annualized 6.3 percent in the first quarter of 2023, accelerating from an upwardly revised 3.3 percent increase in the previous period and above market expectations of a 5.5 percent gain, preliminary data showed. It reflects a 3.4 percent increase in hourly compensation and a 2.7 percent decrease in productivity. Year-on-year, labor costs were up 5.8 percent, easing from a 6.3 percent advance in Q4.

Anyhow, Let’s Define A Few More Technical Price Marks That Might Be Important
In The Coming Days, Based On Today’s Price Action Intraday Development On This Trading Day

Todays price action was a desaster! Because we closed at 33125.69 points – even in the GAP between 32877.53 points and/or 33130.63 points.
Hopefully, we see tomorrow a fight back, a rise up! If not? A more lower price action in the Dow Jones is ahead of us,k if I´m not wrong!

33436.66 points, 33325.37 points, and/or 33235.85 points are important price action areas – which we bulls need to defend.
33593.32 points, 33677.74 points, 33730.85 points, and/or 33791.89 points we bulls need to get back – to get a technically bullish outlook.
33891.15 points, 34018.62 points, and/or 34082.94 points are pathbreaking for us bulls – to start thinking about new annual highs in 2023 back again.
That`s why i pay a lot of attention to the 34257.83 points from the 1st May 2023 – one trading day after the lowest us unemplyoment rate since the year 1969.
Because only when we trade the Dow Jones above this 34257.83 points again can we argue with a short-term breakout of the medium-term sideway trend! Or?