Market Analytics and Considerations
Key notes
- The S&P 500, Nasdaq 100, and Dow Jones all encountered significant supports to begin this week, and today, following yesterday’s lack of movement, a major rebound took place.
- The S&P 500, Nasdaq 100, and Dow Jones all encountered significant supports to begin this week, and today, following yesterday’s lack of movement, a major rebound took place.
- Even though it has been a difficult journey so far though and it is late in the month of December, there is still a chance for a Santa Rally, especially in light of the possibilities of window-dressing through the end of 2022. Could a similar scenario be in effect for 2023 given that the S&P 500’s most recent new peak was achieved during the first week of trading in 2022
Equities had a terrible previous week, and bears were hot under the collar this week. That continued even through Monday’s trading before some significant supports began to come into action for the S&P 500, Nasdaq, and Dow Jones. The fact that all those supports held yesterday and resulted in a rise presently raises the possibility of a Santa rally continuing through to the conclusion of the year.
Those seasonal structures really haven’t appeared to be in effect up to this point, and given the harsh response to the CPI report on Tuesday and the Fed meeting on Wednesday, optimism had begun to wane as it appeared to be increasingly likely that the same lurking bearish conduct had resurfaced its ugly head once more. A still-hawkish Fed and persistently high inflation also have a gloomy possibility heading into the following year.
S&P 500
The S&P 500 is currently testing resistance at previous support, which was a tenacious region spanning from 3912 to 3928. The same region had supported the high points in late October before switching to support some few weeks later. It then supported several attempts until being eliminated the week before.
Merchants made their way all the way back down to some other crucial area of support, which is situated around the Fibonacci tiers of 3802-3810 and contributed to the formation of yesterday’s doji. This morning’s star formation is the result of the yesterday’s doji’s powerful bullish reaction.
Morning stars typically bullish trend forms, and price is currently battling resistance between 3912 and 3928. However, if investors can move over that, subsequent resistance objectives appear near 3960 and the 4k psychological barrier.
NASDAQ
We continue to believe that the Nasdaq would be more appealing if wanting to track negative perspectives on US equities, and not just from a fundamental standpoint. Objectively speaking, the strong theme has not been as well-developed here in comparison to the S&P above, and even today’s jump was not as strong.
The Nasdaq’s former support region, which is approximately 11,470, has not yet been tested, so also there is the issue of the distance from resistance at previous support that is missing.
The Nasdaq’s notable support level is the same one that emerged to support those 11,069 low points in June. Yesterday’s check of this level produced a doji with a similar design, and today’s intensity produced a morning star at the same level.
If we extend over today’s top, that 11,470 mark will continue to act as a barrier layer for those considering how to weaken that resilience.
DOW.JONES
The Dow continues to be a more desirable venue for bullish equity pushes even if the Nasdaq is more appealing for bearish equities pushes. This was included in this week’s technical prediction because the Dow having begun to approach a crucial support test. To make apples-to-apples analogies, the Dow not just to maintains its position above those of the S&P 500 and Nasdaq, but it also found support off of that area on Monday until a significant reaction emerged today.
Obtained by plotting around 33,444, the price has now crossed a crucial barrier that can serve as potential as quick support. Additionally, there is a split in the Dow futures that still exists, just around the 33,053 movement, which may also serve as support for positive continuance possibilities.
