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Dow Jones Technical Analysis: Index Extends its Losses – 14 March 2022

We expect more decline for the index during its upcoming trading.

The Dow Jones Industrial Average declined during its recent trading at the intraday levels, to record new losses in its last sessions, by -0.69%. It will lose the index by -229.88 points to settle at the end of trading at the level of 32,944.20, after its decline in trading on Thursday by -0.34 %.


During the past week, the index decreased by -670.61 points, or -1.99%. This weekly loss is the fifth in a row, thus recording the longest period of weekly losses in nearly 3 years, specifically since the week ending May 31, 2019.

22 of the 30 index components declined, with Nike Inc. Cl B by -2.70%, and Apple Inc. by -2.39%, then JPMorgan Chase & Co. shares. By -2.25%.

Investors have been focused on the headlines related to Russia’s ongoing invasion of Ukraine that began more than two weeks ago, with continuing concerns about inflation and upcoming central bank interest rate increases. It will have a greater impact on markets than the potential impact of the Ukraine war.

The Federal Reserve will hold its first monetary policy meeting since the conflict began this week, with analysts widely expecting a rate hike of around 25 basis points, amid growing concerns that the central bank could push the economy into recession as it struggles with inflation pressures.

Goldman Sachs lowered its forecast for economic growth in the United States, citing the effects of high oil prices and the conflict on European soil. Data from the University of Michigan Consumer Survey showed a decline in March’s preliminary reading of 59.7 from February’s level of 62.8.

Technically, the index’s decline comes amid the dominance of the bearish corrective trend in the short term, and the stability of its trades below the level of 33,271.93. This is in light of its continuing suffering from the negative pressure generated due to its movements below the simple moving average for the previous 50 days, as shown in the attached chart for a (daily) period. The index’s decline comes despite the influx of positive signals on the relative strength indicators, which indicates the control of the selling forces on the index’s movement.

Therefore, we expect more decline for the index during its upcoming trading, throughout its stability below the level of 33,271.93, to target the support level of 32,071.40.

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