Wednesday, December 22, 2010

Dow Jones industrial average is at its highest since Aug. 29, 2008

The Dow Jones ends +55 points to another 2-year high. Despite persistent concerns on Eurozone debt woes following another possible downgrade on Portugal’s debt rating by Moody’s, the Dow Jones continued its upward trajectory to reach a fresh 2-year high at 11533 points on strengthening economic outlook and optimistic corporate forecasts coupled with M&A deals.

Share prices of Adobe (the top maker of graphic-design programs) and Jabil Circuit (the top electronics manufacturer) rallied following better-than-expected earnings
forecasts whilst bank shares jumped after Canada’s Toronto-Dominion Bank agreed to buy Chrysler Financial Corp.

On Wall Street, in view of the expanding Bollinger bands and rising RSI, the Dow could head higher for the remaining trading sessions in 2010, offsetting the overbought slow stochastics indicators.

Immediate resistance level is 11657 (upper Bollinger band) whilst support levels are 11337 (middle Bollinger band) and 11238 (50-d SMA).

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