Equity bulls returned to the market on Friday and helped to drive the Dow Jones futures YM March contract higher once again testing the psychological 14000 level as a result and ending the trading session as a wide spread up candle on the daily chart.
Last week’s price action also delivered a further key signal, namely an isolated pivot low on Thursday’s price bar at 13809 and from here in this morning’s Globex trading session has helped to lift the YM March contract through 14000 to trade, at time of writing at 14033.
Whether the result of this price action is sufficient to move the index higher, remains to be seen but if so, then below we will have a solid and extensive area of price support in place which extends virtually throughout the whole of February.
However, from a fundamental perspective this week is notable, not only for testimony from Ben Bernanke but also for the budget sequester on Friday, 1st March. And in the run up to this event expect to see some highly volatile trading sessions as traders and investors are battered by the unfolding events in Washington.
By Anna Coulling
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