Technical Analysis – US 30 index continues the upside rally near 35,000

  • US 30 holds above 61.8% Fibo and SMAs

  • RSI and stochastic suggest bearish correction in near term

  • Only a move above 35,985 would shift broader bias to positive

The US 30 (Cash) index has advanced considerably after the bounce off the 32,320 support level, overcoming the 200-day simple moving average (SMA) and the shorter-term SMAs. Notably, the price is rallying well above the 61.8% Fibonacci retracement level of the down leg from 35,685 to 32,320 at 34,400 but with weaker momentum than before.

Technically, the RSI indicator found resistance near the 70 line and the stochastic oscillator is ready for a bearish crossover between its %K and %D lines in the overbought territory, both suggesting a negative correction in the near term. However, the MACD is still extending its bullish momentum above its trigger and zero lines, indicating more gains.

Immediate resistance is coming from the 35,100 barrier, taken from the peaks on August 31, before meeting the 35,685 barricade, registered in August 1. Any jump above these levels would shift the broader outlook to bullish as well.

Alternatively, if the bears take the lead, the price may head towards the 61.8% Fibonacci of 34,400 ahead of the 100-day SMA near the 34,260 support. Steeper losses would open the door for the 50.0% Fibonacci of 34,000 and the 33,850 zone, which stands near the bullish crossover within the 200- and the 50-day SMAs.

All in all, the US 30 index is looking bullish in the near term and any movements above 35,685 would brighten the long-term outlook too.

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