US 30 analysis: the likelihood of a reversal to a downtrend increased after the inflation data release

11.10.2024

The US 30 stock index significantly slowed its growth rate and will likely reverse into a downtrend. The US 30 forecast for next week is moderately negative.

US 30 forecast: key trading points

  • Recent data: the US Consumer Price Index (CPI) rose by 2.4% over the past 12 months
  • Economic indicators: after labour market data, inflation is one of the crucial gauges for the US Federal Reserve in determining its future monetary policy
  • Market impact: if inflation falls, there is hope that the Fed will continue a soft monetary policy, which will benefit the stock market
  • Resistance: 42,620.0, Support: 41,840.0
  • US 30 price forecast: 41,490.0
  • Fundamental analysis

    The report’s inflation data shows that the CPI rose by 2.4% over the past 12 months, while analysts expected it to be 2.3%. The reading is slightly above the 2.0% inflation target set by the Federal Reserve.

    US 30 technical analysis
    Risk Warning: the result of previous trading operations do not guarantee the same results in the future

    Source: https://tradingeconomics.com/united-states/inflation-cpi

    With inflation remaining close to the target and the interest rate already reduced by 0.5%, the regulator may slow the pace of further cuts. Despite soft lending conditions, 2.4% inflation combined with higher housing and food costs may raise concerns about consumer activity. If inflation falls without accompanying economic growth, investors may become more cautious.

    Market participants will likely need additional clarification from Federal Reserve management about their assessment of inflation and unemployment data. The stock market will remain strong if the regulator does not change its rate-cut plans. Until then, investors will likely be uncertain. The US 30 index forecast is moderately negative.

    US 30 technical analysis

    The US 30 stock index has been trading below the 42,620.0 resistance level for over a week. According to the US 30 technical analysis, this indicates a decrease in the potential for further growth. The index is highly likely poised for a reversal into a downtrend. A breakout below the 41,840.0 support level will signal its beginning, with a decline target at 41,490.0.

    US 30 technical analysis
    Risk Warning: the result of previous trading operations do not guarantee the same results in the future

    The following scenarios are considered for the US 30 price forecast:

  • Pessimistic US 30 forecast: a breakout below the 41,840.0 support level could send the index down to 41,490.0
  • Optimistic US 30 forecast: a breakout above the 42,620.0 resistance level could drive the price to 42,870.0
  • Summary

    The report provides inflation data showing that the CPI rose by 2.4% over the past 12 months, while analysts expected it to be 2.3%. The US 30 stock index has been trading below the 42,620.0 resistance level for over a week and will likely reverse to a downtrend in the short term.

    ¡Atención!

    Los pronósticos de los mercados financieros son la opinión personal de sus autores. El análisis actual no es una guía de trading. RoboForex no se hace responsable de los resultados que puedan ocurrir por utilizar las recomendaciones presentadas.