DJIA (DOW) Extends Reach Above 30,000

Following a ho-hum Monday session, the DJIA is extending its bull run above 30,000. At the halfway point of the Wall Street business day, the DJIA DOW (+90), S&P 500 SPX (+7), and NASDAQ (+20) are trading mixed. Thus far, it looks like another slow early December session for U.S. stocks.

Compared to yesterday, the economic calendar does feature a few noteworthy items. Below are this morning’s highlights:

Event                                                                   Actual                 Projected           Previous

NFIB Business Optimism Index (Nov.)            101.4                         NA                       104.0

Nonfarm Productivity (Q3)                                  4.6%                        5.0%                      4.9%

Redbook Index (MoM, Dec. 4)                            -2.4%                        NA                         1.3%

All in all, this isn’t a strong group of metrics. Optimism is definitely off as more lockdowns become the norm across the United States. Perhaps the biggest surprise is the month-over-month drop in the Redbook Index (Dec. 4). Typically, this time of year is positive for the retail sector ― given the persistence of COVID-19, December 2020 is a whole new ballgame.

Despite the doom and gloom, investors remain optimistic about U.S. large caps. Now, the DJIA is holding above the 30,000 psyche level and looking for more.

The DJIA Rallies Above 30,000

For the time being, it looks like 30,000 is the key support level for the Dow Jones Industrial Index. If the COVID-19 vaccines prove effective and more U.S. government stimulus comes to pass, the DOW may hit 32,500 sooner rather than later.

Bottom Line: If we see a late-session pullback to 30,000, a buying opportunity may come to pass for the December E-mini DOW. Until the closing bell, I’ll have buy orders in the queue from 30,026. With an initial stop loss at 29,974, this trade produces 50 ticks on a standard 1:1 risk vs reward ratio.

ABOUT THE AUTHOR See More

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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