As capital rotates from tech to financials and small caps, we analyse key support levels for the Dow Jones ahead of a pivotal week of major US bank earnings.
Chart of the week: US Wall Street 30
Key takeaways
Rotation favours Dow and small caps: Since late December 2025, capital has rotated into cyclicals and laggards, with the Dow Jones (+3% YTD) and Russell 2000 (+5.7%) outperforming the S&P 500 and Nasdaq 100 into early 2026.
Bank earnings are the near-term catalyst: With financials making up ~28% of the Dow, upcoming Q4 earnings from major US banks could drive heightened volatility and directional follow-through in the index this week.
Bullish trend intact, key levels in focus: The US Wall Street 30 CFD index remains in a medium-term uptrend above its 20- and 50-day MAs; holding above 47,870 key support, while a break below this level would signal trend invalidation.
Since late December 2025, there has been an ongoing rotation in the US stock market. The prior laggards, Dow Jones Industrial Average and small-cap Russell 2000, have been outperforming the AI-centric mega-cap technology stocks that are heavily weighted in the S&P 500 and Nasdaq 100.
As of January 9, 2026, the Russell 2000 and Dow Jones Industrial Average have recorded a gain of 5.7% and 3%, respectively, which overtook the S&P 500 (1.8%) and Nasdaq 100 (2%) (see Fig. 1).
Fig. 1: YTD performance of major global stock indices as of 9 Jan 2026 (Source: MacroMicro).
This coming week, several major US financial institutions will report their Q4 2025 earnings results; JPMorgan (Tuesday, 13 January), Bank of America, Citigroup, and Wells Fargo (Wednesday, 14 January), Morgan Stanley, Goldman Sachs, and BlackRock (Thursday, 15 January).
The US financial sector, with a weightage of around 28%, is the largest weighted component in the Dow Jones Industrial Average. Hence, the earnings release of the aforementioned US financial institutions may trigger a more volatile movement in the Dow Jones Industrial Average for this week.
Let’s now decipher the movement of the US Wall Street 30 CFD index (a proxy of the Dow Jones Industrial Average futures) from a technical analysis perspective.
Fig. 2: US Wall Street 30 CFD index medium-term trend as of 12 Jan 2026 (Source: TradingView).
Fig. 3: Ratio charts of S&P Financials & S&P Banks ETFs over S&P 500 ETF as of 9 Jan 2026 (Source: TradingView).
The price actions of the US Wall Street 30 CFD index have evolved into a medium-term uptrend phase after it hit a low of 45,711 on November 21, 2025, as it continues to trade above its 20-day and 50-day moving averages at the time of writing (see Fig. 2).
In addition, the ratio charts of the S&P Financials exchange-traded fund (ETF) and the SPDR S&P Bank ETF over the S&P 500 ETF have traded above their respective 50-day moving averages decisively in November and December, which suggests a potential medium-term outperformance of US banks (see Fig. 3).
Watch the 47,870 key medium-term pivotal support on the US Wall Street 30 CFD index. A clearance above 49,805 intermediate resistance sees the next medium-term resistances coming in at 50,265/50,446 (Fibonacci extension), and 51,010 (Fibonacci extension and upper boundary area of the medium-term ascending channel).
On the other hand, a break and a daily close below 47,870 invalidates the medium-term uptrend to expose the next medium-term supports at 47,470/47,230 and 46,610.
Read also: January 2026 market watch: 3 key trade setups as China macro shifts
The information presented is historical information, and past performance is not indicative of future performance.
