120419 WallstrM 120419 WallstrM 120419 WallstrM

Technical Update - Corrections unfolding in Nasdaq and SP 500 but how deep and can it turn into bearish trends?

Equities 3 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

  • USNAS100 CFD and US500 CFD levels included in the analysis

Nasdaq 100 formed last week a top an reversal pattern. Sell-off has since hit the Index lead by Nvidia – see separate analysis.

Nasdaq seems destined to test the support and the 0.382 retracement at 19,347-19,290.

A close of the gap i.e., a close below 19,210 is likely leading to further selling down to the 0.618 retracement and support at 18,875

However, RSI is still showing positive sentiment and there is no divergence i.e., no imbalance indicating this is merely just a correction and the  Index is likely to resume uptrend when done.

But if Nasdaq 100 is closing below 18,873 and RSI is closing below 40 threshold a bearish trend has been established
nasdaq d 2506
Source all charts and data: Saxo Group

USNAS100 cfd levels. Minor support at the 0.382 retracement at 19,358. Strong support at around 18,900 where both the 0.618 retracement of the latest bullish move and the 0.382 retracement of the uptrend since mid-April are also placed.

A close above 20,083 and the bullish trend will resume

usnas100 d 2506

S&P 500 bullish trend seems to be stalling and a correction is unfolding. Question is how deep and will it turn into a downtrend.

Key support at around 5,340 but a dip down to 5,311 could be seen. 

Minor support at the 0.382 retracement at 5,385

For S&P500 to resume bullish trend a daily close above 5,506 is required. That scenario is not unlikely to plays out; RSI is still showing negative sentiment with no divergence indicating this is merely just a correction and S&P500 is likely to resume uptrend after a correction

A daily close below 5,310 is likely to add to the selling pressure pushing the Index down to around 5,258-5,191

RSI is moving within a rising channel pattern: A daily close below the lower rising trendline and the 60 threshold is an indication the Index is likely to test the key support at around 5,314

 

sp500 d 2506

US500 levels: Minor support at 5,391 and 5,346. Strong support at 5,315. A daily close above 5,516 and the bullish trend will resume

 

us500 d 2506

Quarterly Outlook 2024 Q3

Sandcastle economics

01 / 05

  • 350x200 peter

    Macro: Sandcastle economics

    Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.

    Read article
  • 350x200 althea

    Bonds: What to do until inflation stabilises

    Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain inflation and evolving monetary policies.

    Read article
  • 350x200 peter

    Equities: Are we blowing bubbles again

    Explore key trends and opportunities in European equities and electrification theme as market dynamics echo 2021's rally.

    Read article
  • 350x200 charu (1)

    FX: Risk-on currencies to surge against havens

    Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperform in Q3 2024.

    Read article
  • 350x200 ole

    Commodities: Energy and grains in focus as metals pause

    Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities in Q3 2024.

    Read article

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15
2900
Hellerup
Denmark

Contact Saxo

Select region

International
International

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.