Dow Jones Technical Analysis: Index Continues to Decline – 09 March 2022
Our expectations indicate the continuation of the index’s decline during its upcoming trading.
The Dow Jones Industrial Average continued to decline during its recent trading at the intraday levels, to record losses for the fourth consecutive session, by -0.56%. It lost the index towards -184.74 points, to settle at the end of trading at the level of 32,817.39, after it declined in Monday’s trading by -2.37%.
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With a trading volume of more than 553.7 sheets, the last index’s decline came as a continuation of its series of losses for the previous three sessions, as 22 components of the 30 indices fell, the most prominent of which was a percentage loss of Coca-Cola Co. It fell by -3.96%, and Procter & Gamble Co. shares. by -3.96%, and UnitedHealth Group Inc. shares. By -2.76%.
Concerns about the clashes between Russia and Ukraine and the mounting sanctions imposed on the Kremlin have pushed up the prices of all commodities, raising concerns about inflation. It can influence the Federal Reserve’s decisions about the speed and size of interest rate hikes, which could slow economic growth.
In US economic data, the National Federation of Independent Business said its small business optimism index fell 1.4 points to 95.7 in February, the lowest level in one year. The largest number of small businesses since 1981 said high inflation was their main concern, with many increasing prices to offset their rising costs.
The US trade deficit rose 9.4% in January to a record $89.7 billion as the US bought more foreign oil, cars, and other goods.
Technically, the index’s decline comes for the fourth consecutive day, amid its being affected by the breaking of a minor bullish trend line in the short term. It will then announce the continuation of the bearish corrective trend, with continuous negative pressure due to its trading below the simple moving average. This is shown in the attached chart for a (daily) period of time, as we note In the midst of this, negative signals started to appear in the RSIs, after they reached clear overbought areas, to confirm the index with its recent closing of breaking the important support level 33,271.93.
Therefore, our expectations indicate the continuation of the index’s decline during its upcoming trading, throughout its stability below the level of 33,271.93, to target the first support levels at the level of 32,071.41.