Tech rebalance and volatility catalysts – Dow Jones and US Stock Index Outlook

Ben Graham · 3 horas atrás

Stock traders are rebalancing their positions ahead of next week's FOMC and key earnings
After the past two rebounding sessions, weekend risks and high-tier events stalls the impulse
Exploring Technical Levels for the Dow Jones, Nasdaq and S&P 500

Stocks are back to quite a decent outlook, and Markets are all out on yet another phase of the Debasement Trade, which just took Silver to $100 and Gold to $5,000.

However, as we head into the weekend, some factors of uncertainty could create significant volatility and change the current market picture in high fashion.

One of the first and most evident yet easily overlooked is the Federal Chair appointment announced by the US President.

As evidenced in this remarkable piece, Trump suggested a decision around his return to the White House from Davos (and he just came back).

The race is between Rick Reider, BlackRock's CEO, and a well-positioned Wall Street veteran who could be the surprise. His appointment would reassure the US Dollar and bond markets the most.

On the other hand, Kevin Warsh, the heavy favorite, an ex-Governor at the Fed from 2006-2011 (rough period), could maintain the current trend.

Any communications regarding the decision will be market-rocking.

fed chair odds 2301 — Fed Chair nominees Prediction-Market odds – Source: Kalshi

A second risk catalyst for this weekend is the high potential for geopolitical catalysts as we conclude a period full of headlines – heavy US military assets are concentrating in the Middle East, and my thesis is that the Greenland issue was being offered as a distraction.

On that aspect, Oil is up 2.50% and still rebounding at its Risk-Premium support area – Check out our latest in-depth analysis for WTI to learn more.

We will see more on this this weekend – If nothing happens, expect stocks to keep up their path higher.

A third potential volatility contributor could be current Market levels – with Gold reaching $5,000, Silver exploding by 250% to $100, and Stock Markets at all-time highs, one small profit-taking wave can turn into a significant selling cascade, particularly as we approach the FOMC.

All three factors, when combined, could significantly affect the Market picture, so keep an eye on how they interact.

us data 230126 — Morning US Data – January 23, 2026 – Source: TradingView

In terms of today's action, US Consumer Sentiment just beat expectations, and Inflation expectations cooled down, usually a positive for the Market, but with key tech Earnings (helping Nasdaq to outperform) and the Fed Meeting approaching (January 28), don't expect a straightforward path ahead.

As a reminder, Microsoft, Meta, Tesla, and ASML report after the close on FOMC day, while Apple and Visa follow on Thursday.

Heamtpa 23001 morning — Current picture for the Stock Market (11:39 A.M. ET) – Source: TradingView – January 23, 2026

Magnificent 7s and Semiconductors are doing the heavy-lifting in today's sessions. Microsoft (MSFT) is leading its peers to the upside, while Defensives and Financials drag lower as their earnings season is now complete for the most-part.

Dive into our daily session charts and trading levels for the major US Indexes: Dow Jones, Nasdaq, and S&P 500 – Watch for weekend volatility as the situation is not fully clear yet and Iran remains a factor.

Dow Jones 4H Chart

dow jones 2301 4h — Dow Jones (CFD) 4H Chart – January 23, 2026 – Source: TradingView

The Dow just rejected its all-time highs, not so surprising as we head into the weekend and the direction has mostly stayed rangebound since 2026.

The range, extending between 48,000 and 49,700 provides levels of interest for upcoming action:

A clear break above should see fast-paced continuation, first to the 50,000 Milestone and surely higher (particularly if the recent doubts and uncertainties get resolved)
Any weekly close below 48,000 can precede more downside, potentially extending to 45,000.
- For the short-run watch if the current retracement stalls at the 4H 200-MA (48,663), which would be the most bullish corrective outlook

Dow Jones technical levels for trading:

Resistance Levels

Morning highs 49,663
Short Timeframe resistance 49,200 to 49,300
49,650 to 49,670 Current ATH Resistance
All-time Highs 49,710
50,000 Potential Psychological Resistance

Support Levels

49,041 4H 20-period MA
Christmas ATH High Timeframe Momentum Pivot – 49,000
Intraday support 48,600 to 48,700 (4H 200-period MA)
Psychological Support and range lows at 48,000
45,000 psychological level (Main Support on higher timeframe)

Nasdaq 4H Chart

nasdaq 2301 — Nasdaq (CFD) 4H Chart – January 23, 2026 – Source: TradingView

Nasdaq is now taking the lead (for the first time in a while) in today's action, as traders reposition ahead of next week's high-expectation-earnings.

The pressure is high for the tech-heavy index: These early 2026 reports will reflect on this current year's projections and 2025 numbers as P/E Ratios reach elevated levels, particularly for Mag 7s.

The index is still showing a decent rebound in today's session, and looking at the previous days' action, a breakout of its 24,000 to 25,800 Range could be close.

A measured move hints at a retest of the All-Time High records.

This will, of course, need to be accompanied by positive (or at least not too pessimistic) fundamentals – A break and close above the 25,850 level should see continuation.

Next week's earnings will have a key influence on the Nasdaq Movement. Keep a close eye on the Fed's communications next week.

Nasdaq technical levels of interest:

Resistance Levels

Session Highs 25,733 (range highs, key test)
Intermediate Resistance 25,700 to 25,850
All-time high resistance zone 26,100 to 26,300
Current ATH 26,182

Support Levels

Momentum Pivot 25,200 to 25,500 +/- 75 pts
session lows 25,428
Minor Support 25,000 to 25,250
24,500 Main support
Early 2025 ATH at 22,000 to 22,229 Support

S&P 500 4H Chart

The S&P is still contained within its main 6,800 to 6,975 Range – Showing similar conditions as the Nasdaq, expect similar breakout scenarios:

A break above the 7,000 All-Time Highs with volume should lead to continued upside.
A rejection and close below the 6,800 key support should see profit-taking acceleration.

S&P 500 technical levels of interest:

Resistance Levels

Session highs 6,938
Previous ATH Resistance 6,945 to 6,975
Current ATH Resistance at 7,000

Support Levels

Pivot Zone 6,880 to 6,900
Mini-Support 6,830 to 6,850 (Past day support)
6,800 Psychological Support
6,789 session lows
Support 6,720 to 6,750 (Mid-December lows at 6,729)
6,400 Major psychological support

Safe Trades and a Blessed weekend!

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