Are Shares in for One other Leg Greater?

Nasdaq 100 & Dow Jones Worth Outlook:

• The Nasdaq 100 pressed to new heights but once more this week because it adopted Asian equities increased
• The Dow Jones stays a laggard, however enjoys close by technical help nonetheless
• Will a broader rally in fairness markets assist lengthen beneficial properties loved by the Nasdaq 100 and Dow Jones?

Nasdaq 100 & Dow Jones Forecast: Are Shares in for One other Leg Greater?

In an uncommon flip of occasions, Asian equities gave the impression to be the driving drive behind early inventory beneficial properties this week because the Dangle Seng index broke above a key technical barrier. Bullishness from the session transitioned into early power for US indices which was then exacerbated by uplifting ISM companies knowledge, which culminated in a stellar efficiency for the Nasdaq 100. The occasions allowed for the tech-heavy index to forge yet one more report excessive, however not like current weeks, it might appear demand for the market’s largest and hottest tech shares was not the preliminary catalyst – a key shift in investor perspective.

To that finish, continued demand in different markets and areas might assist delay the US inventory rally simply as indicators of weak point have been starting to point out. Since I’ve lengthy been crucial of present fairness valuations in the USA, it will likely be fascinating to see if different indices start to outpace the Nasdaq 100, Dow Jones and S&P 500 or if bullishness in different areas will gasoline additional exuberance within the three main US indices. Both method, widespread demand for fairness publicity is an encouraging growth, significantly when mixed with a few of the constructive knowledge readings rising from varied international locations.

Nasdaq 100 Technical Outlook

Within the case of the Nasdaq 100, little has modified from a technical perspective because the index stays locked inside the ascending channel from mid-April. Apparently, worth motion stalled close to the 10,600 stage on Monday, suggesting the Fibonacci stage possesses at the least a modicum of affect. Ought to bulls obtain a profitable drive above the barrier, additional bullishness might see the higher sure of the ascending channel examined.

Nasdaq 100 Worth Chart: 4 – Hour Time Body (February – July)

Alternatively, vary merchants will make sure to be aware the index’s place close to the higher stage and IG Consumer Sentiment Knowledgeon every of the Dow Jones and S&P 500 would counsel retail merchants are assured a breakdown will happen to maintain the vary intact – an indication we sometimes affiliate with additional bullishness. Subsequently, there may be little to counsel an imminent reversal.

Dow Jones Technical Outlook

Shifting over to the Dow Jones Industrial Common, it may be argued the index has encountered resistance across the 26,350 mark. Crucially, current worth motion has allowed the Dow to keep away from a sequence of cascading lower-highs, a theme I outlined final week as a key technical menace to the Industrial Common.

Dow Jones Worth Chart: 4 – Hour Time Body (February – July)

To make sure, a continuation above 26,350 can be an encouraging growth which will permit the DJIA to finally re-test the Fibonacci stage at 26,883. Within the meantime, comply with @PeterHanksFX on Twitter for updates.

–Written by Peter Hanks, Analyst for DailyFX.com

Contact and comply with Peter on Twitter @PeterHanksFX