US 30 index unlocks new more-than-7-month high

The US 30 cash index posted a notable bullish day yesterday, jumping above a key level of 34,280, adding to the optimism for further positive movements. The index hit a fresh more-than-seven-month high of 34,600; however, the technical oscillators are currently suggesting a bearish correction. The RSI touched the overbought region and dived lower, while the MACD is holding beneath its trigger line.

Should the price manage to reinforce the upside move, the next resistance could come around 35,500, registered on April 17. A break above this line would take the market towards the 35,900 resistance, taken from the peak on February 6.

However, if prices are unable to break the recent high in the next few sessions, the risk would shift back to the downside, with the 34,280 immediate support coming into focus as well as the 33,150 barrier. A drop below this area would test the 200-day simple moving average (SMA) at 32,400 ahead of the 100- and 50-day SMAs at 32,000 and 31,750 respectively. The next hurdle to watch lower down is 28,600 that will switch the outlook to bearish again.

In a nutshell, the index is bullish after the bounce off 28,600 in the short-term and any moves above the next resistance levels may change the broader picture to positive as well.

About the author

Melina Deltas

Melina joined XM in December 2017 as an Investment Analyst in the Research department. She can clearly communicate market action, particularly technical and chart pattern setups. Her technically focused method looks mainly at price action across multiple time frames to capture big moves that develop over the years. She has more than 3 years of experience in analyzing financial markets, specializing in forex, indices, and commodities. Melina studied Pure Mathematics at Lancaster University and has a Master's Degree in Monetary and Financial Economics from the University of Cyprus. Currently, she is an associate member of the Society of Technical Analysts (STA) and a Certified Financial Technician (CFTe).