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U.S. equity index futures little changed
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Euro STOXX 600 index up ~0.4%
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Dollar down; crude ~flat; gold rises, bitcoin up >3%
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U.S. 10-Year Treasury yield slips to ~3.40%
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DOW INDUSTRIALS: RUMBLE, BUMBLE OR STUMBLE? (0900 EDT/1300 GMT) Over the past four trading days, the Dow Jones Industrial Average has been consolidating in an especially tight range. On the plus side, this action may well be a bullish pennant implying the impending continuation of the DJI's late-March-early April advance:
Meanwhile, with this, a measure of volatility, on an hourly basis, just hit a one-year low, suggesting the DJI is especially ripe for a dynamic breakout of its shorter-term range. By mid-day on Monday, the DJI's hourly Bollinger Band width had compressed to its tightest reading since mid-April 2022. Compressed band width does not in itself predict direction, but it can signal a market primed for much more spirited action, or indeed, its next trend. On a thrust above the April 4 high at 33,642.72, the DJI can quickly move to challenge the resistance line from its January 2022 record high, which is around 34,020 on Tuesday. Since establishing this line with its mid-December high at 34,712.28, the DJI put in three distinct highs in January to February of this year. These highs were all packed in a tight range, all lower, and all capped by the resistance line. These highs were at 34,342.32, 34,334.70 and 34,331.47. Thus, traders will be keenly focused on the DJI's action in the event it thrusts higher to once again challenge the resistance line. On the downside, breaking the 50-day moving average (DMA), which ended Monday around 31,115, may see pressure quickly intensify. The 23.6% Fibonacci retracement of the March 2020-January 2022 advance is at 32,530, and the 200-DMA ended Monday around 32,470. The mid-March trough was at 31,429.82. In any event, with a highly anticipated CPI release on Wednesday, traders may not have long to wait before the blue-chip average sees some real fireworks.
(Terence Gabriel)
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FOR TUESDAY'S LIVE MARKETS POSTS PRIOR TO 0900 EDT/1300 GMT - CLICK HERE <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ DJI04112023 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Terence Gabriel is a Reuters market analyst. The views expressed are his own)
