Despite recent volatility triggered by concerns surrounding artificial intelligence (AI) stocks, the Dow Jones Industrial Average (DJIA) continues to demonstrate resilience, outperforming its tech-heavy counterpart, the Nasdaq 100. This analysis delves into the factors driving this relative strength, examining intermarket signals and technical indicators to provide a medium-term outlook for the DJIA. We will build upon our previous report from November 5th, 2025, offering a timely update on the market dynamics at play.
Dow Jones Outperformance Amidst AI Sell-Off: A Closer Look
The recent market turbulence, sparked by fears of a “bubble bursting” in AI-related technology stocks like Nvidia, has led to an indiscriminate sell-off across major US indices. However, the Dow Jones has weathered this storm more effectively than the Nasdaq 100. As of November 24th, 2025, the DJIA experienced a month-to-date loss of -2.3%, compared to -3.8% for the Nasdaq 100. This divergence highlights a fundamental difference in the composition and underlying drivers of these two indices.
The Role of Value Factors and Yield Curve Dynamics
A key factor supporting the Dow Jones’ resilience is its heavier weighting towards value-oriented sectors, particularly financials, which constitute 27% of the index. This contrasts with the Nasdaq 100’s dominance by growth stocks. Currently, intermarket signals strongly favor the value factor. The US Treasury yield curve has been re-steepening, moving from 0.48% on October 29th, 2025, to 0.53% on November 7th, 2025.
Value ETF Breakout Signals Strength
This re-steepening has coincided with a bullish breakout in the ratio chart of the S&P 500 Enhanced Value ETF versus the S&P 500 ETF. Simultaneously, the ratio chart of the S&P 500 Momentum ETF (heavily weighted in Information Technology) experienced a bearish breakdown. These movements suggest a shift in investor preference towards value stocks, which directly benefits the Dow Jones. The outperformance of value, coupled with the yield curve dynamics, reinforces the expectation of medium-term outperformance for the DJIA over the Nasdaq 100. Understanding these market signals is crucial for investors.
Technical Analysis: Maintaining a Bullish Bias
Despite a recent pullback below its 20-day and 50-day moving averages, the Dow Jones remains within a well-established medium-term ascending channel, originating from the May 23rd, 2025 low of 41,156. The current price, at 46,392 (as of writing), continues to hold above this crucial support level.
Key Support and Resistance Levels
The daily Relative Strength Index (RSI) has also shown signs of stabilization, bouncing off a key horizontal support at the 35 level, indicating waning downside momentum. This suggests that the recent sell-off may be losing steam.
Maintaining a bullish bias over the medium term is warranted, with a pivotal support zone identified between 45,650 and 45,020. A break above the 47,100 resistance could trigger a renewed bullish impulse, potentially retesting the recent all-time high of 48,460. Further resistance lies at 49,130/49,220, a cluster coinciding with Fibonacci extension levels. However, a breach of the 45,020 support would invalidate the recovery scenario and potentially extend the correction towards the long-term pivotal support at 43,935 (also the 200-day moving average). Technical indicators provide valuable insights into potential price movements.
Recent Price Action and Future Outlook
The US Wall Street 30 CFD Index, a proxy for the Dow Jones Industrial Average futures, had previously rallied to a fresh all-time high of 48,460 on November 12th, 2025. The subsequent sell-off, beginning on November 17th, 2025, was directly linked to the negative cascading price actions within the AI sector. While the overall market sentiment has been shaken, the DJIA’s relative strength suggests it is better positioned to navigate this period of uncertainty. Investors should monitor stock market trends closely.
In conclusion, the Dow Jones Industrial Average continues to demonstrate resilience in the face of AI-driven market volatility. Supported by its value-oriented sector weightings, favorable intermarket signals, and a stable technical outlook, the DJIA is poised for potential medium-term outperformance. Investors should closely monitor the key support and resistance levels outlined above, and remain aware of the evolving dynamics within the broader market landscape. For further insights and analysis, visit https://www.marketpulse.com/.
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