US Market Outlook: Indices under pressure

Last week, major US stock market indices faced pressure as the Dow Jones Industrial Average, S&P 500, and NASDAQ Composite index all fell. The Dow Jones dropped by 0.85 per cent, the S&P 500 by 0.57 per cent, and the NASDAQ Composite by 2 per cent. This downward trend continued for the third consecutive week, with the indices failing to maintain initial gains, indicating weak follow-through buying.

Key resistances are at 51,960 and 52,350, suggesting a negative bias for the Dow Jones, which could fall to 51,000-50,800 in the short term. A bounce back to 51,500-52,000 is possible if it manages to recover. However, breaking below 50,800 could intensify selling pressure, potentially dragging the Dow Jones down to 50,600 or 49,800.

The S&P 500 may decline to 7,500 or 7,480-7,460, with a corrective rise to 7,600 being a possibility. If this rise fails to surpass 7,600, the downward pressure will increase, potentially pushing the index to 7,400 or 7,300 in the medium term. Near-term resistance for the Dow Jones lies between 25,900 and 26,000, while the NASDAQ Composite index could fall to 25,000-24,800.

A break below 24,000 cannot be ruled out. Cluster supports are present in the 24,800-24,000 region, and a bounce back from this range could lead to a corrective rise to 25,500-26,000. The dollar index, currently at 101.96, has decreased from its last week's high of 102.49 but remains under a positive overall bias. A fall below 101.20 could limit downside, while 101-100.90 is the next important support zone.

The dollar index may rise back and surpass the immediate resistance of 102.50, potentially climbing to 103-103.50. Only a break below 100.90 will signal a negative outlook, with a possible fall to 100 and lower levels. The US 10Yr Treasury Yield, now at 4.93 per cent, fell for the fourth week in a row, failing to sustain a rise above 5 per cent.

It reached a high of 5.05 per cent but has since fallen. A decline to 4.85-4.80 per cent is possible, after which the yield can increase back to 5-5.05 per cent, maintaining the broader uptrend. Only a break above 5.05 per cent will lead to further gains, potentially reaching 5.2 per cent or higher. In the long term, the outlook remains bullish, with the potential to reach 5.6 per cent.