What To Watch For The Dow Jones Industrial Average This Week

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September 11, 2017 8:19am INDEXDJX:.DJI NYSE:DIA


Market technician Dave Chojnacki of Street One Financial kicks off the new trading week with a recap of last week’s anemic action, and updates the important technical levels to focus on as geopolitical and hurricane-related news continued to dominate the headlines.

The market opened lower on Friday, with investors concerned about the impacts of Hurricane Irma and geopolitical issues (specifically North Korea). Equities traded in a narrow range and were choppy for the second straight session. Tech stocks were leading the way to the downside, pushing the Nasdaq 100 (NDX) to a moderate loss by the end of the session.

Selling in the last hour left the S&P 500 (SPX) slightly lower, while the Dow Jones Industrial Average (DJIA) managed to eke out a small gain. At the close, the DJIA was up 13 points, the SPX slipped 3.6 points, and the NDX fell 0.85%. Breadth was slightly negative, 1.18 to 1, on above average volume.

ROC(10’s) were mixed, with the DJIA crossing back into positive territory. RSI’s are now in the upper 40’s to lower 50’s. The ARMS Index ended at 1.33, a bit bearish. For the week, the DJIA was down 0.8%, the SPX slipped 0.6%, and the NDX gave up 1.2%.

The VIX was up 4.9% to 12.12 on Friday, and was up 12.6% for the week. Economic reports will be light this week, but the impact of hurricanes and geopolitical issues remain.

Long term, the upside bias continues. The NDX pulled back from its recent highs, while the DJIA and SPX were unable to make new highs. The major indices remain comfortably above their 150D SMAs: DJIA-21163, NDX-5633, SPX-2405.

Short term, the major indices continue to keep the upside bias intact as well. The SPX is sitting just below its 9 month trend-line (2470). Upside bias would be in danger if it could not get back above this trendline, however.

The major indices continue to just barely hold above their 50D-SMAs: DJIA- 21748, NDX-5849, SPX-2454. We will be watching this level closely this week. The DJIA is the only major index below its 20D-SMA of 21847.

Europe is higher in early trade on Monday, and U.S. Futures are pointing significantly higher in the premarket. There are no major economic reports on tap for today.

The SPDR Dow Jones Industrial Average ETF (NYSE:DIA) rose $1.17 (+0.54%) in premarket trading Monday. Year-to-date, DIA has gained 12.15%, versus a 11.33% rise in the benchmark S&P 500 index during the same period.

DIA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #4 of 75 ETFs in the Large Cap Value ETFs category.

Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, David Chojnacki, does not endorse or recommend any issuer or security mentioned herein.

About the Author: Dave Chojnacki

Dave Chojnacki is the Chief Market Technician at Street One Financial. He provides technical support for the Street One team and also develops individual analysis for Clients as requested.

Dave is a major contributor to the ‘ETF Daily’, a morning newsletter providing clients a daily look at market technicals of the major indices and selected ETF’s. Market trends, support and resistance levels are provided in the daily letter. The Technical portion of the daily can also be found on Seeking Alpha. Mr. Chojnacki has been quoted in a number of industry publications including the Reuters, ETF Trends, Minyanville, Yahoo Financial and Investors.Com.

In addition, Dave assists with desk trading when necessary. He possesses a Series 7 and 63.

Prior to joining Street One, Dave designed and developed I/T Systems for the Insurance and Financial Industries.

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