Dow Jones Falling More Than Expected
- The Dow fell more than 1,100 points, the worst sell-off in nearly two years
- Target and walmart quarterly reports that drag things even worse
- Initial Jobless Claim releases could contribute to further pressure on the stock market
Dow Jones Index Outlook
A day after the Dow Jones Industrial Average suffered its biggest one-day drop since 2020, stock futures were still under pressure this Thursday. Therefore, since this morning it feels gloomy because stocks are falling pretty much everywhere. The Walmart boom casts a very negative color on the note, destabilizing the past few days and has been witnessed from this Tuesday through Thursday.
Yesterday, the Dow Jones fell more than 1,100 points, marking its worst sell-off in nearly two years. The S&P 500 also had its worst one-day decline since June 2020, losing about 4%, and the Nasdaq Composite was down 4.7%.
The losses were driven in part by successive quarterly reports from Target and Walmart that showed higher fuel costs and restrained consumer demand undermined yields amid the hottest inflation in decades. Overseas markets followed Wall Street’s lead overnight, with stocks in Japan, South Korea and across Europe all falling. Stocks have been under pressure throughout the year, as concerns over rising inflation and higher interest rates have fueled a sell-off in riskier assets such as equities.
Moreover, with the release of initial jobless claims also scheduled for this Thursday (1230 GMT) it could add pressure to the conditions currently being experienced by stock futures.
Technical Outlook
From a technical perspective, the Dow Jones Index’s very strong bearish trend continues. Moreover, by being initiated by the fall in value in one day yesterday, it has a very strong impact on the Stock Market. Last Friday’s low was touched again. Although there is an opportunity to bounce and can be used as a means of recovery, with the pressure on the market in three consecutive months, how far is the ability to go up?
A very clear scenario that appears is the index value can rise to retest the new Supply area (32500) which is a foothold to continue the downward rally. Will the October 2020 (30000) lows try to touch Back? Or it’s going to be worse? We clearly see the wide gap in November 2020.
The key area to consider is 31000 for Long, but if it breaks it will go to the 29000 area as a strong support to go Long again. Or the key area to continue Short is at the value 32500.
