Dow Jones 30 index (US 30) hovers around uptrend line; rebound is expected.
The Dow Jones 30 index is moving lower, approaching again the ascending trend line, which has been holding since February 2. Also, the index dropped below the 50- and 200-simple moving averages (SMA) in the daily timeframe, while the momentum indicators are supportive of the bearish structure. The MACD oscillator has dived below the trigger line with strong momentum and the RSI holds in the bearish zone with weak movement.
Should the price continue to head south, it would be interesting to see whether the rising trend line can stop the bearish movement. If this is not the case, the market could slip until the next barrier at the 24,110 support, which stands marginally below the diagonal line. Even lower, the 23,520 could act as a major support as well, confirming the scenario for more losses.
On the upside, the 200-day SMA is the next obstacle to look for around 25,100 and the 50-day SMA further up near 25,672. A jump above these lines would bring the focus to 26,280 resistance, taken from the peak on November 8.
In the longer timeframe, the index has been following an upward move and only a daily close below the rising trend line could increase the chances for a bearish tendency. A rebound on the line is expected in the next few sessions.
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