Dow Jones and US stocks open lower after massive PPI beat

[Redator]

U.S. data, which had surprised participants for a long while now, has finally shown some of the effects of tariff-led inflation, and they do not look good.

This morning's Producer Price Index (PPI) report came at 0.9% m/m for both the headline and core numbers (expected at 0.2% for both). Y/Y headline is now at 3.3% (vs 2.5% exp) and 3.7%(!!) (vs 2.9% consensus) for the core.

A few FED speakers and economists have mentioned that the impact of tariffs on inflation should only provide a temporary, one-time boost to the change in inflation numbers.

However, despite these claims, too-hot inflation in the present may change future inflation expectations and prompt a hawkish Fed. This should put an emphasis on University of Michigan inflation expectations.

It also takes a few months, but the data should impact consumer prices, as producers will have to pass some of the costs on to avoid killing their profit margins.

It seems that the September Cut will not be straightforward, hurting appetite for risk assets.

For that reason, let's have a look at key levels for the Dow Jones as the morning bell freshly rang.

Read More: Trump’s pressure mounts. The Fed cornered. Will the dollar weaken further?

Current Picture for Indices and US Bonds

Indices and Bonds performance in the morning session, Source: TradingView

The US Dollar is rising strongly, leaving Bonds and Indices lagging since the PPI data got released.

US Indices are finding some small dip-buyers with the Nasdaq leading but we will need to track if the dip-buying can hold the surprising news.

Dow Jones Technical Analysis

Dow Jones Daily Chart

Dow Jones Daily Chart, August 14, 2025 – Source: TradingView

The Dow has broken out to the upside after a 5-day consolidation, mentioned in our previous analysis.

Post ISM Services PMIs that missed, participants looked a bit reluctant to push the pedal for the US 30 but saw what they needed to push the index higher after the CPI report from Tuesday.

Now trading within its all-time highs resistance zone, Bulls will have to push further to mark a more decisive new record price.

In the meantime, momentum seems to be consolidating towards neutral after many weak attempts for bulls to take control.

My take on this is a reluctance from participants to fully discard the effect of tariffs on US manufacturing, preventing new highs like in Tech for example.

Dow Jones 8H Chart

Dow Jones 8H Chart, August 14, 2025 – Source: TradingView

Bulls did retake control of the price action but as mentioned on the daily timeframe, they will have to make a clearer push to decisively break the 45,150 highs to relaunch a trending environment (currently rangebound).

A potential head and shoulders could be materializing if buyers fail to break the yesterday to today's sessions highs (44,988).
Despite not showing up clearly for the moment, buyer failure here could be critical, particularly after the PPI data.

Levels to watch for the Dow Jones:

Resistance Levels

• 44,988 highs to break
• All-time high resistance zone around 45,000
• Current ATH 45,150

Support Levels

• 44,400 to 44,500 Immediate pivot
• 44,100 Thursday lows resistance turned support
• NFP Lows Mini-Support 43,250
• 43,000 Main Support Zone

Dow Jones 1H Chart

Dow Jones 1H Chart, August 14, 2025 – Source: TradingView

Short-timeframes evoke the formation of a small-timeframe upward channel that will need to hold.

This morning's descent post-PPI actually bounced from its highs – Watch for a breakout either to the daily highs (44,990) if bulls manage to overpass this morning's data or a downside breakout (44,725)


Safe Trades!

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