Summary:
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US indices trade not far from last night’s closing level
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US30 rallies above Tuesday’s high on Boeing lift
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Boeing called to open near 4% higher after earnings beat
Yesterday’s recovery for US indices was all the more impressive considering an early swoon lower following the opening bell, which took out recent lows for the S&P500 (US500 on xStation) and the DJIA (US30 on xStation), and while the markets still ended in the red, the majority of the declines were recouped. In the past couple of hours the US30 has moved higher and taken out Tuesday’s high of 25296, boosted by a strong move higher in Boeing during the pre-market trade.
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Open account Try demo Download mobile app Download mobile appGiven the strong bounce, the obvious question to ask is whether Tuesday marked a turnaround for the US markets or whether it was simply a pop higher in the prevailing downtrend. On this front for the US30 the coming couple of hours may well prove pivotal with price threatening to break above the H1 Ichimoku cloud. This indicator has proven a turning point on several occasion previously and two advances in the past week has run into the cloud before reversing lower. As you’d expect the market has been below the ecloud for the vast majority of this month as price has been in a shorter term downtrend although there was one clear move higher which occurred after price broke above the cloud. A clean break above the cloud now would be a positive signal and while it may not represent a turning point in the longer term trend it could easily lead to a rally of 5-600 points - similar to what we saw last week.
US30 is back near the top of the H1 cloud and how price acts in the next couple of hours could well determine the path for the next move. Source: xStation
A gain of more than 4% in the premarket trade for Boeing has boosted the US30 with the rally adding approximately 100 points to the Dow. Boeing delivered core earnings per share of $3.58 on revenues of $25.1B for the 3rd quarter - well above the $3.47 and $23.91B expected. Perhaps even more positive than the results themselves was the fact that the aerospace manufacturer raised its full-year forecast for EPS to $14.90-$15.10 from $14.30-$14.50 previously. Revenue is also now expected to be higher by $1B to between $98-100B. The upwards revision continue a pleasing trend for Boeing, with the firm raising their guidance in each of their 3 reports so far this year.
Shares in Boeing are called to open higher by around 4% after a strong earnings release. The market held a rising trendline yesterday to close back above the 200 day SMA (purple line). Given its large weighting of almost 10% on the DJIA, the gains have boosted the broader market. Source: xStation
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