SPX & DJIA Standstill – Key Levels Focusing Fed Fund Rate
Arslan Butt • 1 min read
Stock market indices are trading bearish ahead of the US monetary policy decision today. It’s all about selling the rumors, buying the facts. Investors seem to speculate the rate hike decision and are selling stock market indices at higher prices to buy back at low prices.
Logic Behind Sell-off
It’s obvious that we invest in stock markets to earn maximum dividends, right? But let’s say if the cost of borrowing increases, corporate sectors would have to pay higher interest rates than before. Consequently, their profit margins will decline and they will pay fewer dividends.
Being an investor, is this something you want? Surely not. Thus, you will be looking for other opportunities to invest in, perhaps, the forex, bonds or commodity markets. That’s exactly what’s happening with US stocks now.
Anyways, considering the potential volatility ahead, I have identified key trading levels of SPX and DJIA.
S&P500 – SPX- Trading Levels
Key Trading Level: 2765.13
DJIA – Dow30 – Trading Levels
Key Trading Level: 25021.5
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