- The Dow Jones remained about 41,000 during the market session in the middle of the week.
- Investors are reducing their exhibition while waiting for the last appearance of Fed Powell.
- It is widely expected that the Fed keeps rates without changes, but the markets look for signals of a change.
The Dow Jones industrial average (DJIA) adjusted to the average during Wednesday’s early trade, staying just above the important level of 41,000 while investors await the last decision on Federal Reserve (Fed). The Fed has almost guaranteed maintaining stable interest rates in the midst of generalized uncertainty in the market due to the volatile political strategies that arise from the Trump administration, however, anxious investors for fence cuts will be attentive to the appearance of the president of the FED, Jerome Powell, later today, since they look for signs that the Fed could be approaching a new cycle of cuts.
The hopes of fed rates cuts collide with a fed reluctant to cut
The hopes of a short -term change towards new rate cuts can be poorly structured; According to the FXSTERET Fed feeling index, the overwhelming majority of Fed speakers have moved away from language that would imply imminent rate cuts. With a strong labor scene and inflation continuing its decrease towards objective levels, the Fed has few reasons to be excessively concerned with lowering interest rates to support an economy that does not seem to need it. Adding the fact that the clumsy commercial and tactical policies of the Trump administration have significantly raised market volatility, the Fed has little room for maneuver to deliver feat cuts that both the White House and the market participants have been asking.
The news that the US and China are preparing to start commercial conversations this weekend in Switzerland initially supported the actions at the beginning of Wednesday, but the US Treasury Secretary, Scott Besent, was quick to moderate market expectations. According to Treasure Besent, commercial conversations in Switzerland will simply be a preliminary measure, and significant progress could take some time to materialize.
Dow Jones price forecast
The Dow Jones has pivoted towards an intermediate pattern this week, moving in the graph near the level of 41,000. The offers remain overwhelmed in the 50 -day exponential (EMA) mobile average, and the impulse in any direction has evaporated.
Dow Jones daily graphics
Dow Jones Faqs
The Dow Jones Industrial Avenge, one of the oldest stock market indexes in the world, consists of the 30 most negotiated values ​​in the United States. The index is weighted by the price instead of capitalization. It is calculated by adding the prices of the values ​​that compose it and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, also founder of the Wall Street Journal. In recent years it has been criticized for not being sufficiently representative, since it only follows 30 companies, unlike broader rates such as S&P 500.
There are many factors that promote the Dow Jones Industrial Average (DJIA) index. The main one is the added performance of the companies that compose it, revealed in the quarterly reports of business benefits. The American and world macroeconomic data also contribute, since they influence investor confidence. The level of interest rates, set by the Federal Reserve (FED), also influences the DJia, since it affects the cost of credit, on which many companies depend largely. Therefore, inflation can be a determining factor, as well as other parameters that influence the decisions of the Federal Reserve.
Dow’s theory is a method to identify the main trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Avenge (DJIA) and the Dow Jones Transportation Average (DJTA) and just follow the trends in which both move in the same direction. The volume is a confirmation criterion. The theory uses elements of maximum and minimum analysis. Dow’s theory raises three phases of the trend: accumulation, when intelligent money begins to buy or sell; Public participation, when the general public joins the trend; and distribution, when intelligent money abandons the trend.
There are several ways to operate with the DJ. One of them is to use ETF that allow investors to negotiate the DJ as a single value, instead of having to buy shares of the 30 companies that compose it. An outstanding example is the SPDR Dow Jones Industrial Avenge ETF (day). Future contracts on the DJ allow the specular operators about the future value of the index and the options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Investment funds allow investors to buy a part of a diversified portfolio of DJ values, which provides exposure to global index.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
