The Dow Jones 30 Futures (CME: YM) surged 1.16% in Wednesday’s trading session, supported by the hope of the debt ceiling crisis being resolved. In addition, bets on the next Federal Reserve interest rate decision have pointed to a pause, giving equities a break.

The Labour Market Reports and Fed Chair Jerome Powell’s speech are the remaining heavyweight events of the week which traders will be glued to. Given that the market has been edgy over a potential recession, some more insight into the state of the U.S. economy will be unveiled.

Technical

The Dow Jones 30 Futures have pointed lower in recent weeks, with price trading in a descending channel pattern and crossing below the 100-day moving average to validate a downtrend. Support and resistance were established at the 33031 and 34341 levels, respectively.

The 33031 level lured bullish traders into buying the index, with the next intermediate resistance at the 61.80% Fibonacci Retracement Golden Ratio level a possible point of interest, given the bearish reaction to the level before. Bearish traders will likely look to short the Dow Jones 30 Futures nearer to the Golden Ratio if declining volumes accompany upside price action. Bears will probably aim for support at the 33031 level if they commit to the downside in numbers.

Summary

Given that the market has diligently respected the 33031 level as a support level, the Dow Jones 30 Futures will likely avoid finding a value lower than that in the short to medium term unless macroeconomic conditions force it lower.

Sources: Reuters, TradingView