Fundamental
Overview
The Nasdaq bounced strongly from the lows yesterday following good US Jobless Claims figures as the data
quelled some of the fears around the labour market after the weak US NFP report last Friday.
The market pricing for rate
cuts eased a bit but remains quite elevated with a 55% probability of a 50 bps
cut in September and a total of 103 bps of easing by year-end. If the NFP
report was indeed negatively impacted by Hurricane Beryl, which is what has
been transpiring from the data, then we can expect the market to go back to the
old script of resilient growth and positive risk sentiment.
Moreover, the Japanese
markets shouldn’t be a problem anymore given that the Japanese officials made
it pretty clear that they won’t proceed with more tightening given the
volatility in the markets.
Nasdaq
Technical Analysis – Daily Timeframe
Nasdaq Daily
On the daily chart, we can
see that the Nasdaq eventually bounced on the trendline around the 17400 level and extended
the gains following the US Jobless Claims figures. The target for the buyers
should stand around the broken trendline at the 19000 level. That’s where we
can expect the sellers to step in with a defined risk above the trendline to
position for a drop back into the lows targeting a breakout.
Nasdaq Technical
Analysis – 4 hour Timeframe
Nasdaq 4 hour
On the 4 hour chart, we can
see that we had a strong resistance
zone around the 18500 level but the price is breaking out today. We can expect
more buyers piling in with a defined risk below the zone to increase the
bullish bets into the 19000 level. The sellers, on the other hand, will want to
see the price falling back below the zone to position for a drop back into the
lows.
Nasdaq Technical
Analysis – 1 hour Timeframe
Nasdaq 1 hour
On the 1 hour chart, we can
see that in case the price were to fall back below the zone, we might see a
pullback into the upward trendline. That’s where we can expect the buyers to
step back into the market to position for a rally into the 19000 level with a
much better risk to reward setup. The sellers, on the other hand, will want to
see the price breaking below the trendline to increase the bearish bets into
the lows targeting a break below the major trendline. The red lines define the average daily range for today.