Technical Analyst, Saxo Bank
Summary: S&P 500 / US500 cfd. Nasdaq 100 / USNAS100 cfd
The potential Shoulder-Head-Shoulder patterns that were under development in both S&P 500 and Nasdaq 100 were demolished yesterday.
The strong bullish move could result in both Indices testing July peaks. However, uptrends are not yet confirmed by Indicators. Mood can easily turn sour again
S&P 500 Closed back above rising trendline and back above the Cloud.
The Shoulder-Head-Shoulder S&P500 that were under development seems to have been demolished by the Index close yesterday above 4,459.
The key support 4,340 where not broken meaning the SHS pattern where never confirmed.
S&P 500 has now resumed to uptrend.
However, RSI is still showing negative sentiment and needs to close above 60 to change that.
If RSI does close above 60 there is more upside potential for S&P500. Potential to test July high at around 4,607
If RSI is failing to close above 60 S&P 500 could slide back towards key support at 4,430
US500 cfd: Back above rising trendline and back above the Cloud
RSI is still showing negative sentiment and needs to close above 60 to change that.
If RSI does close above 60 there is more upside potential for US500. Potential to test July high at around 4,607
If RSI is failing to close above 60 US500 could slide back towards key support at 4,430
Nasdaq 100 By closing above 15,367 Nasdaq 100 has reversed its downtrend and cancelled it Shoulder-Head-Shoulder like pattern.
Bears can still hang their hat on the fact that RSI is still showing negative sentiment and needs to close above 60 to change that.
If RSI does close above 60 there is more upside potential for Nasdaq 100. Potential to test July high at around 15,932. This scenario is likely to play out if the Index is closing above the Cloud (shaded area)
If RSI is failing to close above Nasdaq could slide back towards key support at around 14,687
USNAS100 cfd. Seems to be building an uptrend when closing yesterday above 15,366.
However, USNAS100 closed just below the upper part of the Cloud and RSI still needs to close above 60 threshold for uptrend confirmation.
If RSI does close above 60 USNAS100 is likely to test July peak at around. Key question will then be whether the Evening Doji top and reversal pattern will be cancelled.
If RSI is failing to close above 60 and instead is being rejected USNAS100 could test the key support at 14,687.
A close below there is downside potential to 13,568 but with strong support at around 14,250.
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.