Technical Analyst, Saxo Bank
We are still seeing strong resistance at 6,840 in the Nasdaq 100 despite Tuesday's relativelt strong tech-sector performance. The index has now been rejected twice at this level, so despite the bullish candle posted Tuesday, this could still prove an issue over the next couple of sessions. Another thing to note is that the Relative Strength Index remains bearish for this index.
Ultimately the Nasdaq 100 needs to close above 6,840 for further upside. If it does, we could see new highs. Zooming in on the intraday chart, however, we see a potential double top formation in the making; an hourly close below 6,740 would confirm it.
That scenario would likely lead to a selloff, taking the index to a test of the key support line at 6,400 (we also see some support around 6,600).
In the S&P 500, we see a shooting star where the body gap of the early February selloff couldn’t be closed. This was followed by a bear gap Tuesday, which indicates trouble for bulls. Also note that the RSI is turning south again.
A drop to around 2,673 looks likely for this index. For bulls to regain control, they need to bring the S&P 500 to a close above Friday's highs at around 2,755.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
