Dow Jones Futures: Market Rally Meets Key Resistance; Time to Buy Apple Stock — or Shortly?

Dow Jones futures open Sunday night, along with S&P 500 futures and Nasdaq futures. The stock market rally held support levels last week. Now, can the S&P 500 move above its 200-day moving average in the coming days and weeks? Apple (AAPL) might be the key.


Apple stock held key levels, rising slightly despite the general market decline. Like the S&P 500, the iPhone tech titan is once again approaching its 200-day moving average. A decisive move above this level could present a buying opportunity. But another rejection could present another chance to short AAPL stock.

Meanwhile, other Dow Jones components Boeing (BA), JPMorgan Chase (JPM) and GS stocks have quietly enjoyed a respectable run over the past few weeks, which has contributed to the Dow’s outperformance in the current market rally. BA stock is technically right around a traditional buy point. Goldman Sachs (GS) is forging a deep base while JPM stock has work to do.

Dow Jones futures today

Dow Jones futures open at 6:00 p.m. ET on Sunday, along with S&P 500 futures and Nasdaq 100 futures.

Keep in mind that overnight action in Dow futures and elsewhere doesn’t necessarily translate to actual trading in the next regular trading session.

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Analysis of the stock market rally

Last week, the Dow Jones Industrial Average was up less than 0.1% in trading over the past week. The S&P 500 Index fell 0.7% and the Nasdaq Composite fell 1.5%. Small-cap Russell 2000 is down 1.75%.

On Tuesday, November 15, the S&P 500 briefly surpassed 4,000, approaching the 200-day moving average. This level is particularly important as the benchmark index reversed just 1 point from the 200-day moving average on August 16, sparking another leg in the bear market.

A decisive move above the 200-day moving average, which would also roughly coincide with a falling spike trendline from the Jan. 4 all-time high, would be a strong signal that the uptrend is more than a bear market rally.

The S&P 500 clearing the 200-day moving average would also be a positive backdrop for leading stocks struggling near buy points in a choppy market.

Meanwhile, the Russell 2000 fell back below its 200-day moving average last week, but would likely regain that level ahead of the S&P 500. Buoyed by Boeing, Goldman and JPM stocks, the Dow Jones is comfortably above the 200-day moving average. But breaking last week’s high would take the Dow back to 34,000 and just below its August high.

The Nasdaq, weighed down by aggressive growth, is 8.3% below the 200-day moving average. A break above last week’s highs would be a good first step. Also positive: The 21-day moving average just surpassed the 50-day moving average on Friday.

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Thanksgiving week is not necessarily a good time for a big market move. Markets are closed on Thanksgiving with a half-day session on Friday. Volume will likely be low throughout the week. The following week ends with a bang. On December 1st, investors will receive PCE inflation data for September along with ISM’s manufacturing index for October. The October jobs report is due on December 2nd. This news could have a major impact on Fed rate hike expectations, bond yields and stock prices.

So it wouldn’t be a surprise if the major indexes traded in a range for the next week or so. There is nothing wrong with a small consolidation of the major indices and leading stocks.

Apple stock

Apple shares rose 1.1% to 151.29 last week after the previous week’s 8.2% surge. Stocks held their 50-day moving average, with the 21-day moving average set to overtake the 50-day moving average. AAPL stock is only slightly below its 200-day moving average. The Dow giant flirted with its 200-day gain on Oct. 28. But that turned out to be a great short selling opportunity as shares fell to their worst close since mid-June within days.

A decisive move above the 200-day moving average, perhaps a clear of 157.50 28th October high would provide early entry into a bottom formation from 17th August. But if Apple stock turns down from this area, it could offer a new shortcut opportunity.

Apple’s success or failure at the 200-day moving average could be key to the S&P 500’s own attempt and vice versa.

Boeing stock

BA shares fell 2% to 173.89 after rising 47% over five weeks. While aerospace giant Dow Jones reversed gains on Oct. 26, shares rallied, particularly on the back of a bullish cash flow forecast a few days later.

Technically, Boeing stock is just below the 173.95 cup base buy point. But shares are 9.5% above their 200-day moving average and 19.5% above their 50-day moving average. A break around the current level could create a safer buying opportunity.

Boeing is expected to turn a profit in 2023 and end four years with losses.

Goldman stock

GS shares slipped 1.55% last week to 379.20. On a daily chart, shares are extending from a 358.72 cup base buy point within a much larger consolidation. On a weekly chart, Goldman stock has a buy point of 389.68 from a one-year cup and handle basis, according to MarketSmith analysis. But after a 28% gain on a four-week winning streak, it’s an awfully small hold. A longer, lower grip would be helpful and allow the 50-day moving average to close the gap.

The line of relative strength is at a four-year high, reflecting Goldman stock’s outperformance versus the S&P 500. The RS line is the blue line in the provided charts.

JPM share

JPMorgan shares fell 1.1% last week to 133.84. That’s after an advance of 29.5% over six weeks. Stocks are above their 50-day and 200-day moving averages, but still have work to do. JPM stock could form the right side of a long deep consolidation or bottom.

Read The Big Picture every day to keep up to date with market direction and leading stocks and sectors.

Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.


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