Dow Jones Lags Behind as Tariff Uncertainty Casts Shadow Over CPI Week
MarketPulse | Jul 14, 2025 04:40AM ET
Equity Markets have been fluctuating in the past week, and this has concerned the Dow Jones even more than the more properly trending Nasdaq and S&P 500, which have been making all-time highs almost every day or two since the end of the Israel-Iran war.
The picture in Equities is red throughout the globe as more tariff uncertainty gets into the bullish sentiment. Don't forget that the TACO Trade has been the ongoing theme, outshining Tariff Fears, which may be making a comeback.
One aspect that the market has been examining is why the Dow Jones has been lagging against its major index counterparts.
The more tech-focused Nasdaq and S&P 500 are being dragged up by the Magnificent 5, an ongoing trend since the 2022 Bear Market Lows, particularly with NVIDIA (NASDAQ:NVDA) attaining a $4T market cap this week.
However, the broader, industrial-focused Dow shows a clearer picture of the overall market: The economy is doing more than fine (US 30 dawdling very close to its ATH). However, uncertainties on the future US outlook are high, preventing a straightforward risk-on sentiment throughout all indices.
Markets are notably preparing for Tuesday’s US CPI data (exp +0.3%), where hopes are always high for a further pushback of stagflationary US Tariff fears. With the latest August 1st tariff extension, it won't be easy to know their impact in the coming weeks.
Dow Jones Industrial Average Multi-Timeframe Analysis, from Weekly to Intraday Charts
Dow Jones Weekly Chart
Source: TradingView
The Dow, like other indices, has been evolving in a Secular upwards Channel, more than doubling since its 2020 Covid Lows (18,200!).
Looking at higher timeframes helps us to understand how markets keep growing despite uncertainty, as money flows, government spending, but more positively, technological progress just keeps pushing the limits, with a US Economy holding strong even with much higher interest rates.
One thing to be careful about, however, in the current picture, is the buyers' inability to breach the February all-time highs compared to Nasdaq and S&P 500, which may add to some technical bearishness.
Either way, if markets were so afraid of tariffs, we would not be trading at such elevated levels, but this trend is something to look out for in the upcoming weeks and months.
Dow Jones Daily Chart
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Looking closer at Daily Charts, the picture is mixed.
Indeed, there are no signs of Bearish Divergence looking at the daily RSI, a positive sign for Bulls.
Contributing to the mix of technical signals, Daily Candles have failed to overpass the preceding highs (45,060 ATH vs 44,919 Last Swing highs) a bearish sign – on the other hand for positive outlooks, there is a bullish 50-200 Day Moving Average crossover, known as a Golden Cross which has traditionally been very positive for Stock Indices.
Markets are getting prepared for the upcoming Inflation report on Tuesday at 8:30, where my guess is that we will be getting some key insights into future trends for Equities.
A bullish next-week close will look at bigger themes than TACO Tariffs wish-wash.
A bearish next-week close will bring back Tariff fears to the table to dictate the upcoming fundamental themes.
Dow Jones 4H Intraday Chart
The immediate picture is looking a bit rosy. Markets have started to react to ever-more frantic Trump-Tariff policies, and this is scaring markets that keep trying to make new highs.
The steep upward trendline has broken (expected from steep trends), leaving the door open for a more sustainable, flatter uptrend line. One problem, however, is that this trendline also broke down, with the 4H 50-MA also coming as immediate resistance.
Anyhow, current trading is noise in the bigger picture, as volumes and trends tend to retract before key numbers such as the CPI – Tuesday will be the major key to the upcoming weeks' trends (in the waiting of August 1st).
Monitor the 44,000 Current Key Pivot for bearish reversals, as long as we maintain above, the picture is still more bull/neutral than bear.
Safe Trades in the preparation of next week's major data!
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