Dow Jones forms rising wedge ahead of NFP and FED's Waller comments on rate cuts – what it means for the index

[Redator]

US indices just concluded a decent month after a scary monthly open, with the Dow Jones up 3.44% in August. With this month commencing, participants are expecting high volatility ahead.

Traders can remember how volatile the prior day to the July NFP and the actual release were – Looking at the state of current state of Markets, a calm before the storm situation is looming.

Indeed, with the pricing of rate cuts still subject to change, Markets are still expecting some change in stance: there is just a bit more than 2 FED cuts priced in towards the rest of the year.

(a little fundamental parenthesis before the Dow Jones charts)

FED's Waller, who is one of the appointees to replace Jerome Powell in May 2026 and made headlines for his dovish comments ahead of the prior month Labor data release, appeared again this morning mentioning that the FED should start cutting soon "because usually when the labor market turns bad, it turns bad fast".

He wants to get ahead of the curve there, understandably when looking at the actual US Job growth the past three months.

The JOLTS job openings data recently releases below expectations 7.181M vs 7.378M expected – which may further shows signs of deceleration in the labor market.

Waller did emphasize that he wouldn't know how much fast the FED would get to neutral (100 to 150 bps are his estimates) and that tariffs were still a tax on US citizens — He still maintained a neutral tone, surely to not hurt his future job opportunities prospects.

Christopher Waller is currently the favorite for the Chair in May 2026.

Current betting odds on who will be appointed as FED Chair, September 3, 2025 – Source: Kalshi

Anyways, let's tackle the multi-timeframe analysis for the Dow.

Read More: Why are government bond yields rising so much as of late?

Dow Jones multi-timeframe analysis

US 30 Daily chart – concerns about the Rising Wedge?

Dow Jones Daily Chart, September 3, 2025 – Source: TradingView

Ahead of Friday's Non-Farm Payrolls release Equities are trading mixed, with only Google demarking from its peers (up a staggering 8.53% as I'm writing this).

Only Nasdaq is up a decent amount today with more profit-taking happening in the Dow Jones and the S&P 500 trading mixed.

The Dow Jones is currently selling off (still not too harshly) – One of the technical elements to be wary about, is the formation of a daily Rising wedge which tends to form the end of uptrends.

Fundamentals still have the chance to break the pattern after NFP, and for that, bulls will have to break above the wedge highs.

RSI momentum is heading downwards but do keep in mind that above 45,000 and the 50-Day MA (44,630), the current trend is still firm.

US 30 4H chart

Dow Jones 4H Chart, September 3, 2025 – Source: TradingView

The Dow is trading mixed in today's session, held within the key 45,000 Pivot Zone located between the psychological level and the 45,285 previous all-time highs.

Awaiting for a change to the fundamentals, traders are holding their breath

Levels of interest for Dow Jones Trading:

Resistance Levels

• 4H 50-period MA 45,420
• Current All-time high 45,764
• ATH Resistance Zone 45,700 (+/- 150 pts)
• 1.618 Fibonacci-Extension for potential ATH resistance 46,260

Support Levels

• Previous ATH resistance zone, now pivot 45,000 to 45,280 (daily highs)
• 45,000 psychological level and low of rising wedge
• 44,400 to 44,500 Main Support

US 30 1H Chart

Dow Jones 1H Chart, September 3, 2025 – Source: TradingView

After forming a short-term double-top, the Index has corrected slightly with prices forming sideways momentum.

A tight range (45,288 highs – 44,916 lows) is forming ahead of Friday's key release, however, days before labor data tend to see strong moves as certain traders place bets while others close positions.

Look for breakouts above or below the tight range for pre-NFP volatility, and keep an eye on the Daily rising wedge.


Safe Trades!

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