Sep 15, 2020, 9:27:48 AM

DJIA: general review

Current trend

Since the beginning of the week, the main American stock index Dow Jones has been showing significant volatility and reaches 28110.0.

The reason for the active dynamics is the extensive news background about transactions of large companies. The main driver is Oracle, which confirmed that the owner of TikTok, the Chinese company ByteDance, has sent a request to the US Treasury Department for a deal, according to which Oracle will act as the platform's representative in the United States. Consideration of this proposal is expected this week. The second asset that contributed to the growth of the index was Pfizer company, which announced that trials of the vaccine against COVID-19 are planned to be completed by the end of October, after which, if the test is positive, the vaccine will be available for use by the end of the year.

At the moment, almost all components of the index are growing, and the leaders of the dynamics are American Express (+3.78%), Pfizer (+3.20%), Boeing (+3.20%), Apple (+3.00%), and Visa (+2.14%).

Support and resistance

The downward correction in the asset is over, as evidenced by the price breaking through the two resistance lines of the local downtrend. Technical indicators issued a new buy signal. Fast EMAs on the Alligator indicator crossed the signal one upwards, and the AO oscillator histogram moved into the buy zone.

Resistance levels: 28200.0, 29150.0.

Support levels: 27950.0, 27450.0.

Trading tips

After growth, buy positions will be relevant, which may be opened after the breakout of 28200.0 with the target at 29150.0 and stop loss 27800.0.

After reversal and decline or consolidation below the local support at 27950.0, sell positions with the target at 27450.0 become relevant. Stop loss is 28200.0, above the local resistance.

Implementation period: 4 days.