Mixed picture of US equities
S&P 500 WEEKLY FORECAST: SLIGHTLY DOWN
S&P 500 TECHNICAL PERSPECTIVES
After hitting an all-time high last month, the S&P 500 established lower highs and lower lows sequentially amid waning buy interest, only as the Fed prepares for refine its asset purchase program. Ethe price action model shown in daily chart is a bit bearish for the in the short term, but the situation could be reversed if the index manages to climb above both the October high and its 50-day SMA, before moresocket key resistance in the 4,465 area. If this scenario materializes, the S&P 500 would be on track to post its first high in some time, an outcome that could lead the way for a movement towards its all-time high at 4,546. On the other hand, if the selling pressure picked up, which seems likely due to the weakening market width, the first support to watch is at 4370 points. A publication date below this floor could trigger a pullback to the monthly low of 4.279 (less than October).
TECHNICAL CHART S&P 500
DOW JONES FORECAST: SLIGHTLY bullish
DOW JONES TECHNICAL PERSPECTIVES
The Dow Jones‘daily chart seems to show the development of a double background pattern since September. This technical formation, which looks like the letter “W”, has bullish implications for the underlying asset when validated. Confirmation occurs when the price ends its W-shape and breaks through the neckline of the silhouette given by the intermediate peak. In our case, this the resistance is in the 35,060 Region. If the bulls managed to push the price above this barrier in the coming week we may be in the early stages of the next step higher, capable of carrying the blue-chip index to 36,500 (see table for other resistance levels). If the Dow Jones fails to gain momentum and begins to decline with more conviction, support in seen in zone 33 800/33 700. If price fto one below that ground, the bullish model previously mentioned would be invalidated, paving the way for a more pronounced drop to the June low to 33,272.
DOW JONES TECHNICAL CHART
NASDAQ 100: SLIGHTLY DOWN
NASDAQ 100 TECHNICAL OUTLOOK: SLIGHTLY DOWN
The Nasdaq 100 is in a similar position to the S&P 500. The presence of higher lows is a short-term bearish signal indicating a deterioration in market sentiment. At the same time, the incessant increase of U.S. Treasury yields also present a short-term risk to technology actions valuations and can be seen as a negative catalyst for price action. That said, if the index drops attention will immediately turn to horizontal support in the 14,775 area. A move below this floor could rejuvenate the downward pressure and trigger a decline to the lower of October To 14 385. To the other side of the coin, if buyers regain control of the market, the first resistance to watch sit close 15,000, near a short term downtrend line in play since last month. Then we have 15,002 (the 61.8% Fib retracement of the September / October sell-off), followed by 15,350.
NASDAQ 100 TECHNICAL CHART
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— Written by Diego Colman, contributor