US30 - H4
The index starts this holiday-shortened week on the front foot, after two straight losing weeks that were mostly fueled by Fed tightening expectations and Friday's broader risk aversion. Solid results from big US retailers had lifted it on Tuesday, but they weren't enough to avert Friday's negative close below key technical levels.
US30 closed below its EMA200 and 23.6% Fibonacci of its last leg higher (October/November), which creates high risk for deeper correction that would breach the 38.2% Fibonacci (35,410), exposing it to the 35,000 area.
Today though, the index tries to regain its poise and as long as it can stay in profitable territory and avoid daily closes below 38.2% Fibonacci, broader upward bias is not canceled. Under such conditions, it can reclaim 36,000, but it will require strong impetus to challenge 36,626.
The week starts in a subdued manner in terms of news releases, but things heat up later on, whereas US markets are closed on Thursday due to Thanksgiving and on Friday they close early. Wednesday is the busiest day that hosts a slew of economic data, with market-moving potential.
US president Biden is likely to announce, before Thanksgiving, his decision on whether to nominate incumbent Fed Chairman Powell for another term, or to replace him. The main contender appears to be Ms. Lael Brainard, who seems to be perceived as more dovish by markets.
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Senior Market Specialist
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.
With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.