Technical Analysis – US 30 index’s gains curbed by 32,800 mark and Ichimoku cloud



The US 30 stock index’s (Cash) recently found foothold at the 32,068 level has elevated its price into the vicinity of the 50-period simple moving average (SMA). In spite of this, instantly limiting additional price gains is the 32,800 barrier coupled with the cloud’s upper frontier. Regardless of the faded incline in the 50-period SMA - reflecting a slight setback in the up move - the rising 100- and 200-period SMAs are preserving the positive picture.

The short-term oscillators are favouring the upside, while the Ichimoku lines are confirming that negative momentum has subsided. The MACD, already above its red trigger line, has nudged back above its neutral mark, while the RSI is struggling to creep higher in the bullish region. The stochastic oscillator is persisting in overbought territory, and its %K line has yet to signal any strong negative price tendencies.

If buyers manage to surpass the cloud, early resistance could come from the 32,975 obstacle before they revisit the all-time-high of 33,229. Conquering this fresh summit, the bulls may then pilot the price towards the 33,500 level, which happens to be the 123.6% Fibonacci extension of the down leg from 33,229 until 32,068. Flying even higher resistance could emanate from the 150.0% Fibo extension of 33,811 and the neighbouring 161.8% Fibo extension of 33,943.

Otherwise, if buyers’ upward drive succumbs to the 32,800 border, a dive in the price may stall around the level of 32,582 before encountering a zone of support from the floor of the cloud at 32,485 until the 100-period SMA at 32,375. Nonetheless, to tilt the scale negative, sellers would need to break below the vital support band of 32,068-32,155. From here, if the 200-period SMA fails to provide adequate footing to secure the bullish structure, the 31,742 level could then be challenged.

Summarizing, should the index hold above the 32,068-32,155 boundary, its attempts to improve could bear some fruit.

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