Tuesday, April 19, 2011

Dow Jones Drops 140 Points As S&P Cuts U.S. Debt Rating Outlook, 19-04-2011

Wall Street Recap: Dow drops 140 points as S&P cuts U.S. debt rating outlook
Despite better-than-expected Citigroup’s earnings, the Dow sank as much as 248 points intraday after S&P cut its outlook on U.S. government debt to negative, saying the political stalemate in Washington could threaten the nation's AAA credit rating.

However, the losses were trimmed to 140 points (close at 12201) as bargain-hunters emerged. After the bell, Texas reported lower-than-expected 1Q2011 results and trimmed its outlook.

Major earnings release scheduled in this holiday-shortened week (closed 22 April on Good Friday) are Citigroup/Texas (18 April) and Yahoo/Intel/IBM/Goldman Sachs (19 April).

Dow Jones outlook: More downward consolidation
Following the breakdown of major supports of 12272 (5-d SMA), 12335 (10-d SMA) and 12288 (mid Bollinger band), near term Dow’s outlook has turned unfavourable. Momentum and trend indicators are also flashing negative signals.

Key results and economic announcements for the rest of the week are Yahoo/Intel/IBM/Goldman Sachs/March housing starts (19 April), March existing home sales (April 20), March leading indicators and weekly jobless claims (April 21).

Major support levels are situated around 12093 (50-d SMA) and 12000 whilst upside targets are 12335 and 12507 (daily upper Bollinger band).

Daily Dow Jones Has More Downward Consolidation As The 10-Days SMA And Mid Bollinger Band Are Broken.

Source: StockCharts.com

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