Significant highs for the Dow sparked by debt ceiling optimism

Dow Futures were also in the green near 33,613 points

By Nadia Elbilassy | @Nadia Elbilassy | 19 May 2023

  • President Joe Biden sparks optimism on the ongoing debt ceiling issue

  • US indices witnessed overnight gains

  • The Dow Jones index has yet to break out of its downward sloping channel range

The most important economic events affecting the movements of US stock indices .

US President Joe Biden's announcement that high-level members of Congress had agreed to avoid a default on payments contributed to the positive sentiment surrounding ongoing negotiations. House Speaker Kevin McCarthy also expressed optimism about reaching an agreement to raise the debt ceiling, which currently stands at $31.4 trillion.

The Dow Jones saw an uptick overnight closing near 33,546 points on Thursday. The Nasdaq index showed a significant increase of around 2%, closing near 13,861 points, while the S&P 500 index rose by approximately 1.05%, adding more than 45 points to close near 4,203 points.

The upcoming speech by Jerome Powell, the Chairman of the US Federal Reserve will be a key catalyst for the US session today late at night.

The pivotal levels that may affect the movement of the US Dow Jones index.

Despite the index's breakthrough near 33,550 range, the index is still moving generally between the boundaries of a downward sloping channel.

The index faces strong resistance levels between 34,300-34,500, which it has attempted to test several times without success in surpassing them. Therefore, if it fails to overcome the 34,500 resistance, it may retreat again to test the support level of 33,000 points. If this level is broken, the decline may extend further to the support level of 31,450 points.

However, if the index succeeds in surpassing the 34,500 resistance level, this may contribute to further upward movement to test the resistance level of 35,300 points. If it surpasses that, the rise may extend further to the level of 36,200 points.

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