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DJIA Index Headed for August Highs

11/18/2022 1:50 PM

The Dow Jones index is correcting in a local uptrend and is trading at 33504.0.

Quotes of US stock indicators slowed their growth against the background of ambiguous rhetoric of officials of regional Federal Reserve Banks (FRB) regarding further prospects for raising interest rates. Thus, the head of the St. Louis Fed, James Bullard, noted that the regulator needs to continue the "hawkish" course, since the current interest rate level does not limit economic activity sufficiently. In his opinion, the target level of the value may range from 5.00% to 7.00%, however, if inflation in the USA slows down in the coming months and quarters, the US Fed will not have to tighten monetary policy as sharply as expected at the moment.

Meanwhile, the American manufacturer and supplier of network equipment for large holdings and telecommunications companies Cisco Systems Inc. in the quarterly report recorded revenue of 13.6B dollars, which was higher than the estimated 13.29B dollars, and earnings per share reached 0.86 dollars, which exceeds the projected 0.84 dollars. In addition, it became known this week that Elon Musk has decided on his successor as head of Tesla Inc., but it was not announced. Not too positive news comes from Starbucks Corp. Thus, the employees of more than 100 coffee shops in the USA announced a strike, as they insist on raising wages and improving the work schedule. 

The growth leaders in the index are Cisco Systems Inc. (+4.96%), Merck & Co. Inc. (+2,38%), Apple Inc. (+1,30%).

Among the companies showing an active decline are Salesforce Inc. (-3.50%), The Walt Disney Co. (-2.66%), American Express Company (-1.26%).

On the daily chart, the index quotes continue their corrective dynamics and increase, reaching a local maximum in early August at around 34000.0.

Technical indicators hold the buy signal, which is still quite strong: the range of fluctuations of the EMA of the alligator indicator is expanding in the direction of growth, and the histogram of the AO oscillator forms new ascending bars, being in the buying zone.

Support levels: 33180.0, 31750.0. | Resistance levels: 34000.0, 35350.0.

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