Is the US market out of the wood?

 This week we witness President Putin landing on US soil, meeting with President Trump, initiating dialogue and hopefully an improvement of ties between the 2 countries.

Over the market, Dow Jones reversed upward on support of 8-week moving average. It also mildly broke through the previous high. The issue here is that Dow Jones is trying to breakthrough the 61.8% of a major projection. It is possible at this moment that it is going to happen. 

Fig 1. Dow Jones weekly chart

However, the climb this time is with a more gradual gradient, it indicates a weakening in momentum. The drop earlier, however, was much steeper.

I believe it will continue its uptrend, but it will be with difficulties.

There is also divergence on MACD, for every higher low on Dow Jones, the lows on MACD are lower. However, I have yet to see lower highs for confirmation.

After the major 61.8% projection, we should see further resistances at between 47,466 to 49,039. however, I think a more prudent level will be 52,688. which coincides with 127% level of major and minor projection.

Trump's tariffs definitely increase the revenue to the government. Its policies in cost cutting over all government agencies as well as its tackling on illegal immigrants enable further savings on unnecessary items. 

However, tariff is a double-edged sword, it will definitely lead to inflation. What Trumps administration needs to do here is to increase value employment and income increment. His policies on localized supply enablement definitely help secure jobs for the people.

Tariff also results in protectionism. In the short run, the country will see positive result in the economy. In the long run however, it will lead to weakening in local competitiveness due to dependency of such protectionism.