Technical Analyst, Saxo Bank
Summary: US equities experienced a volatile weeks testing important support levels. This week could be rebound week
S&P 500
After a week of massive volatility between 4,200 and 4,430 S&P500 closed Friday within a few points from the 200 Simple Moving Average (SMA). Every day buyers managed to close the Index above 4,300 support which indicates that is the support level to look out for.
This morning the future/ US500 CFD is testing the 200 SMA. If it manage to end the day with a close above the 200 SMA we could very well see further upside to 4,500-4,545 at around the 0.618 Fibonacci retracement. However the road up there can be choppy with high volatility.
USNAS100 CFD/future have bounced off the support at around 13,838 a couple of times just to be rejected at the former support now resistance at around 14,452. This Monday morning buyers seem to succeed in another attempt. If closing the day above there is room up to the 200 SMA and the 0.618 Fibonacci retracement around 15,000-15,140.
If today’s low at around 14,366 is taken out sellers are likely to have another go at the support at 13,838.
Russell 2000 small cap index closed the week above the important and strong support at around 1,945. A rebound could go as high as 2,100 with resistance at around 2,148. Another daily close below 1,945 is likely to resume the bear move.
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.