U.S. stock markets are trading higher since the beginning of this year after a fabulous 2019, marking the best performance in six years. Maintaining this momentum, all three major stock indexes the Dow, the S&P 500 and the Nasdaq Composite have already recorded fresh all-time highs in January. On Jan 15, the Dow achieved a milestone closing above the technical barrier of 29,000 for the first time.
Dow’s Performance in Fourth Quarter
The 30 stocks Dow Index, popularly known as Wall Street’s blue-chip index, rallied 22.3% in 2019. This was an excellent performance after a disappointing 2018 when it had lost nearly 6%. In the fourth quarter, the Dow gained 6%.
The Dow reached a milestone, closing above 28,000 for the first time on Nov 15.
Dow Maintains Momentum
The blue-chip index has maintained last year’s momentum since the beginning of 2020. Year to date, the index has gained more than 1.7%. On Jan 15, it ended above 29,000 for the first time. This means the Dow took just three months to complete the journey from 28,000 to 29,000.
On Jan 15, the Dow closed at 29,030.22, well above its 50-day and 200-day moving averages of 28,165.88 and 26,877.94, respectively. In financial literature, the 50-day moving average line is generally recognized as the short-term trend setter, while the 200-day moving average is considered as the long-term trend setter.
It is widely believed in the technical analysis space that whenever the 50-day moving average line surges ahead of the 200-day moving average line, a long-term uptrend for the index becomes a strong possibility.
source: Yahoo Finance