Technical Analysis

S&P 500, Dow Jones, and Nasdaq 100 Technical Outlook: ’Breaks’ Purchased or Offered?

S&P 500/Dow Jones/Nasdaq 100 Technical Highlights:

S&P 500 backing down from resistance to 200-day

Dow Jones thus far the weakest of the foremost indices

Nasdaq 100 pulling again, however holding up the most effective

Take a look at the forecasts for International Inventory Indices and different markets on the Buying and selling Guides web page.

S&P 500 backing down from resistance to 200-day

The market is as weak because it’s been for the reason that December low, and never with out warning because the S&P 500 pulls off stable resistance within the neighborhood of 2800/17. Whereas the previous few days have introduced with them probably the most aggressive promoting shortly, it hasn’t been overwhelming.

Is that this a shallow corrective pullback, or will we quickly see sellers present up in earnest? The reply to that may lie within the subsequent try and rally. Failure to see consumers emerge merely a pause within the decline off the highs could possibly be the hesitation that results in a stronger decline. Even just a little bump increased that rolls over and makes a brand new low beneath no matter low we quickly carve out could be indication bigger decline is underway.

Nonetheless, a push increased with few sellers and avoidance of rolling over could have the 2800/17 space again in focus. This can stay a big ceiling for the market, and if a bigger advance is to proceed this zone might be an vital threshold to beat. Shorts would possibly discover it as one other back-stop for good threat/reward bearish bets.

Macro-techs, with all of the wild swings of the previous 15 months recommend the market could possibly be present process a serious long-term topping course of. A few eventualities I’ll quickly go into additional element embrace discovering a excessive proper about now (bringing into play a large head-and-shoulders high) or not lengthy after a brand new file excessive is achieved (establishing a – Reverse Symmetrical Triangle, or ‘RST’ since Jan ’18.) In both occasion, threat of a serious fall-out continues to be fairly excessive…

Shares are rallying now, try the longer-term view within the International Equities Forecast.

S&P 500 Every day Chart (2800/17, 200-day, how will market reply?)

S&P 500 daily chart, 2800/17, 200-day, how will the market respond?

Dow Jones thus far the weakest of the foremost indices

The Dow coming off the 26k-area has been the weakest of the foremost three indices. It’s damaged down out of a rising channel, however we’ll have to see how a retracement of this transfer performs out (if one develops) to find out if promoting may intensify. The 200-day sits at 25123, highs over 26ok stay resistance.

Dow Every day Chart (out of channel)

Dow Daily Chart, out of channel

Nasdaq 100 pulling again, however holding up the most effective

Whereas the NDX is again beneath the 200-day MA it has held up the most effective. It’s laborious to say but whether or not this signal for the market or not, however it’s price carefully monitoring the relative efficiency of this index because it highlights the bull market darlings – FAANG (Fb, Apple, Amazon, Netflix & Google). As famous again in September earlier than the massive swoon, how goes FAANG & the Nasdaq 100 goes the remainder of the market.

Nasdaq 100 Every day Chart (holding up the most effective thus far)

Nasdaq 100 daily chart, holding up the best so far

To be taught extra about U.S. indices, try “The Distinction between Dow, Nasdaq, and S&P 500: Main Information & Alternatives.” You may be a part of me each Wednesday at 10 GMT for stay evaluation on fairness indices and commodities, and for the remaining roster of stay occasions, try the webinar calendar.

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—Written by Paul Robinson, Market Analyst

You may observe Paul on Twitter at @PaulRobinsonFX

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