The Dow Jones Index has moved into a strong bull run as investors bought the dip following the April crash. It has jumped in the last three consecutive days, reaching a high of $44,095, its highest level since February 20. It is up by over 20% from its lowest point this year.
Fear and Greed Index is rising
The first main reason why the Dow Jones Index may keep rising is the fact that the fear and greed index has moved to the greed zone. Top sub-indexes like the stock price strength, stock price breadth, and put and call options have moved to the extreme greed zone.
The safe haven, market momentum, and junk bond demand indices have jumped to the greed zone, while market volatility has moved to the neutral level. These numbers mean the fear and greed index may keep rising and potentially move into the extreme greed zone.
US stocks and other risky assets like cryptocurrencies do well when investors are greedy.
Federal Reserve interest rate cuts
The other key bullish catalyst for the Dow Jones Index is that the Federal Reserve may start to cut interest rate cuts later this year as Trump’s tariffs are ot causing a sharp increase in inflation.
Goldman Sachs analysts expect the bank to start cutting rates in September this year. They expect that it will cut rates three times this year and several times in 2026.
Morgan Stanley analysts are more dovish as they expect the bank to cut interest rates 7 times in 2026. They also expect the US dollar index to fall to $90. Other analysts from companies like Citigroup and JPMorgan expect it to cut rates more.
Some Fed officials have also hinted if cuts in the near term. For example, Christopher Waller and Michele Bowman have supported a cut in the July meeting. Jerome Powell and other Fed officials have hinted to September cuts.
The Dow Jones Index performs well when the Federal Reserve is cutting interest rates.
Nasdaq 100 and S&P 500 have surged to a record high
The other bullish catalyst for the Dow Jones Index is the fact that some top US indices like the Nasdaq 100 and S&P 500 have already soared to their record highs.
The S&P 500 rose to $6,200 and invalidated the forming double-top pattern. Similarly, the tech-heavy Nasdaq 100 Index has jumped to $22,700 and cancelled the double-top pattern at $22,208.
Therefore, the Dow Jones too will continue rising as bulls target the double-top pattern point at $45,045.
There are other bullish catalysts for the Dow Jones Index, including the end of Donald Trump’s trade wars and potential peace after the end of the Iran and Israel war.
Dow Jones Index technical analysis
Dow Jones chart | Source: TradingView
The daily chart shows that the Dow Jones Index crashed to a low of $36,615 in April and then soared to the current $44,095. It has moved above the important resistance level at $43,108, its highest point on June 11.
The index has recently formed a golden cross pattern as the 50-day and 200-day moving averages crossed each other. It has remained above these averages since then.
The Relative Strength Index (RSI) and other oscillators have also continued to rise. Therefore, the most likely scenario is where the index keeps rising as bulls target the all-time high of $45,045, the highest point on record. A move above that level will point to more gains, potentially to $46,000.
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