Muted Wall Street Open As Investors Take A Breath - Forex News by FX Leaders
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Muted Wall Street Open As Investors Take A Breath

Posted Monday, October 15, 2018 by
Shain Vernier • 1 min read

The tone on Wall Street has been one of caution through the first hour of business. Stocks have traded sideways following last Friday’s rally, the first positive close in three sessions. The pain of the past seven days has been substantial facing the DJIA and S&P 500. A 1000+ point drop in the DJIA has brought the key level of 25,000 back into play. Is 25,000 the new benchmark for Q4 2018?

A Quiet Wall Street Open

After the fireworks of the previous four trading days, it looks like equities players are taking a breath. The leading U.S. indices are in rotation, creating a relatively calm mood following the Wall Street open. Take a look at the daily compression setting up for the December E-mini Dow.

December E-mini DOW Futures (YM), Daily Chart
December E-mini DOW Futures (YM), Daily Chart

Here are the levels to watch for the next few days:

  • Resistance(1): 38% Current Wave Retracement, 25686
  • Support(1): Psyche Level, 25000

Bottom Line: Time after time, we see big-round-numbers dictate the trade of everything from Bitcoin to the British pound. For the DJIA and December E-mini DOW futures, the key area is 25,000. This level is going to be a catalyst for two-way action moving forward. For now, you can bet that all eyes are fixed on 25,000.

Until proven otherwise, the recent bearish trend is best respected. Sells from 25674 are solid entry with the trend. Using an initial stop at 25726, this trade produces 52 ticks on a standard 1:1 risk vs reward management plan.

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About the author

Shain Vernier // US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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