Dow Jones recovers, is this enough to bring back bullish momentum?

[Redator]

Today's session is seeing some recovery flows form the catastrophic Equity performance after Friday's NFP miss.

The session is empty of any major economic release and for now, the lack of geopolitical influences and continuation from Friday's risk-off moves has helped mean-reverters to bring some buying in Equities.

Our analysis from Friday pointed towards prices touching the lower bound of the upward channel in Nasdaq for example and the index is actually leading its US peers (currently up +1.40%) as tech shines again in today's session, led by Microsoft and Nvidia.

The Dow Jones is also up above 1% as we speak but testing some key levels.

Let's take a look at these in a multi-timeframe analysis of the Index.

Read More: Gold close to $3,400 maintains a picture of hesitancy in risk-assets

Dow Jones Technical Analysis

Dow Jones Daily Chart (CFD)

Dow Jones Daily Chart, August 4, 2025 – Source: TradingView

The Dow has found some dip buyers at the 50-Day Moving Average as the mood hasn't dampened further (for now) and participants are still weighing the good earnings season.

Risk-assets can also see some fundamental relief as Markets are still heavily pricing a September cut which would be supporting Equities further as FED Speakers like Bostic start to mention the narrative of the Mandate turning towards Risks to the Economy.

There has been some precedents however of markets rallying until the first cut like in 2001 and 2007 – But traders should be focusing on the present course of action (while preparing their scenarios for future action).

Some levels to keep on your charts:

Resistance Levels

• Thursday Lows Resistance 44,100 to 44,500
• All-time high resistance zone around 45,000

Support Levels

• Current Pivot 43,500 to 43,750 (supported by 50-Day MA at 43,557)
• 43,000 Main Support Zone
• 42,000 June post-war Support

Dow Jones 4H Chart

Dow Jones 4H Chart, August 4, 2025 – Source: TradingView

The ongoing rebound has been surprising to say the least, but buyers are now facing resistance at a confluence of the Thursday lows (around 44,100 CFD – 44,050 on actual index) and the 4H MA 200 (44,063).

Buyers will want to hold current levels and break above to maintain the short-term momentum to avoid the ongoing action continuing the lower highs formation that have started appearing.

RSI Momentum is not oversold anymore, leaving some flexibility for movement.

Watch for individual stock performances for names like Walmart, Costco or McDonalds (who are reporting their earnings on Wednesday) to spot if the appetite for Equities is widespread or lifted upwards by tech.

For now only Amazon is struggling.

Dow Jones 1H Chart

Dow Jones 1H Chart, August 4, 2025 – Source: TradingView

Buyers have somehow recovered all the selling from Friday's entire session (encompassing the overnight Futures highs).

But the action is now showing mixed signs as we approach the mid-session bell – The current 1H candle is showing a doji around the 44,100 resistance Zone (+/- 20 points).

We are trading at a key level.

For a more precise bull/bear strength outlook, you can also watch the 50% Fib (from the down-move) as resistance – Breaking above gives even more momentum to bulls.
The level for the 0.50 is 44,235 on the CFD and 44,143 on the index.

Same for the 0.618 Fib as Support – Breaking below regives the hand to the sellers towards a more bearish momentum.
The level for the 61.8% Fib is 44,021 on the CFD and 43,953 on the actual index.


Safe Trades!

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