US Stock Market Technical Analysis | September 19, 2022

U.S stock futures resume the bearish movement after previous week sell-off

The stock market will continue to trade bearishly as traders and investors await the FOMC meeting this week. A 75-100 bps rate-hike is on the table and more rate-hike might be planned. The market will stay bearish until the actual announcement by the Fed. There is no bullish sign, for now, however, the Fed might not opt for more rate-hike as it is not possible.

If rate-hike continues then the debt cost will increase which is not affordable under the current high money supply level. We might see the Fed start to stall and let the inflation cools slowly. Despite the situation, it is not the time to turn bullish yet on the stock market.

Technical Analysis

Dow Jones Industrial Average (INDU)

DJIA index has reached the horizontal area and shows a slight reaction at the bottom of the range. Despite the situation, the index might continue under bearish pressure until this week’s FOMC meeting. Will the index breakout lower and continue the bearish movement to print a new lower low?

Ebay Inc (EBAY)

EBAY share prices are at an interesting location where it returns inside the bullish channel. It continues under bearish pressure near the bottom of the channel. A bearish breakout might happen and continue to bring the share prices lower to test the monthly SMA 200. If the share prices could maintain the position above the level then there is a chance of a bullish bounce and the start of a new bullish trend.

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