Stock prices rose sharply after news of progress in talks between Russia and Ukraine. This has helped all Wall Street indices to perform well since last week. Optimism and positive sentiment pushed the stock market higher, while metals and oil tumbled.
The technology and growth sectors were the highlights, which supported the Dow Jones-30 Index to reach the level of February 15 at 35,156 early in the American session.
Fed Chairman Jerome Powell spoke optimistically about the outlook for the US economy and how it might handle a cycle of interest rate hikes.
Despite the interest rate increase of 0.25 basis points in its last meeting, the Dow Jones index made a strong advance and it is likely that it could continue that upward trend until 6/8 Murray at 35,937 but it has strong resistance around 35,330.
35,333 is a zone of congestion that has been a strong barrier for the Dow Jones index in the past. Therefore, if a pullback towards this zone is observed in the next few hours and the index fails to consolidate above it, will be an opportunity to sell, with targets towards the 21 SMA located at 34,786.
The eagle indicator has twice touched the overbought zone around 95-points. This means that the market is totally overbought and it is likely that there could be a technical correction in the next few days.
Bearish pressure below 5/8 Murray is expected to break the 21 SMA located at 34,786. Only a close on the 4-hour chart below this zone could accelerate the move down with targets towards the 200 EMA located at 34,247.
