US stocks gain ahead of Fed verdict

By FXStreet FXStreet (Córdoba) – US indexes closed with strong gains for a second day in-a-row, with the Dow Jones Industrial Average up 140 points or 0.84%, closing the day at 16,739.35.

The S&P 500 rose 17.22 points or 0.87% to 1,995.31 while the Nasdaq gained 28.72 or 0.59% to 4,889.24.

Stocks soared after the release of US poor inflation figures, which fueled speculation that the US Federal Reserve will likely delay a rate hike for December.

The Dow Jones broke a major resistance level during the American afternoon, now a key support, the 61.8% retracement of the latest weekly slump around 16,660. With investors pricing a no-hike from the FED, a move by the Central Bank will be a tough bone to digest, and will likely imply a sharp intraday decline. But if Yellen remains on hold, the rally can extend into next week, with a recovery up to the 17,700 likely in term.

DJIA technical view

“Technically, the daily chart shows that the 20 SMA has turned higher, and stands now around the 50% retracement of the same decline in the 16,380 region, whilst the technical indicators continue heading higher in positive territory”, said Valeria Bednarik, chief analyst at FXStreet. In the …read more

Source:: FX Street