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Whilst last week was generally positive for US equities with the main indices advancing, as we start a new trading week, for the Dow 30 and in particular the YM emini we are now approaching a key level of resistance once again, which will define whether this index joins the S&P 500 and the Nasdaq 100 in trending higher, or stalls once again.

The key level now immediately ahead is in the 25,500 area, and this is most clearly seen on the weekly chart for the index. Following the volatility of February and early March, this level was subsequently tested several times during this phase of price action, and on each occasion held firm. This area was then tested again in June, more recently in late July and also again last week thereby not only creating a strong ceiling of resistance, but also defining a congestion zone that has seen the index oscillate between 25,500 to the upside and 23,700 to the downside.

With key levels now in place any sustained move higher will require this ceiling of resistance to be breached with momentum and volume. However, looking at the volumes during the July rally, these do appear average, but as always we have to remember we are in the depths of summer when volumes always tend to be much lower. Moving to the volume point of control indicator, the VPOC itself as denoted with the yellow dashed line, this remains firmly anchored at 24,600 and reflects the heaviest concentration of transacted volume to date, but as we can see as we move towards the 26,000 level and above volumes become very light, so should the index manage to breach the 25,500 resistance, then we should see the index climb steadily as there is little resistance from the volume nodes to hinder progress higher.