|Day's Range||6,727.94 - 6,816.23|
|52 Week Range||5,895.12 - 7,700.56|
Although last week started with the focus on corporate earnings, the news primarily responsible for most of the gains were the Chinese government’s efforts to stimulate the domestic economy and reports that China is willing to make an effort to reduce its trade surplus with the United States in an effort speed along the process of achieving a trade deal in a timely manner.
Based on the earlier price action and the current price at 6804.50, the direction of the March E-mini NASDAQ-100 Index the rest of the session is likely to be determined by trader reaction to the downtrending Gann angle at 6797.00.
Based on the early price action, the direction of the March E-mini NASDAQ-100 Index futures contract the rest of the session is likely to be determined by trader reaction to a pair of Gann angles at 6713.00 and 6716.50.
Given the slew of weakening inflation data, the Fed is likely to remain patient about raising interest rates this year. In its last monetary policy statement, it forecast two rate hikes this year, but since then several policymakers have said they would be cautious about tightening monetary policy. Currently, the financial markets are forecasting zero rate hikes for 2019.
With the exception of Chicago Fed President Charles Evans, who came across as a tad hawkish, Bostic, Bullard and Rosengren were all in line with the minutes of the Federal Reserve December minutes which showed policymakers were willing to pause interest rate hikes given the volatility in financial markets and concern about global growth.
It’s a big week ahead, with the Brexit vote on Tuesday and a mass of data to give further direction on the global economy, as earnings season kicks off.
Based on the earlier price action and the current price at 6610.25. The direction of the March E-mini NASDAQ-100 Index futures into the close on Friday is likely to be determined by trader reaction to the long-term downtrending Gann angle at 6577.00
While the market may have perceived the Fed as being overly aggressive, the minutes revealed policymakers took a more cautious approach to further rate increases than their statement indicated.
Based on the early price action, the direction of the March E-mini NASDAQ-100 Index the rest of the session will be determined by trader reaction to the main Fibonacci level at 6485.75. Traders should also watch for a possible closing price reversal top since the market is up eight trading sessions since the December 26 main bottom.
Asian markets were mixed in Tuesday trading as investors wait on trade-related news. European indices were higher across the board at midday on optimism US/Sino trade talks would produce positive results. US futures were indicated to open higher in early premarket trading.
Atlanta Fed President Raphael Bostic fired the first volley on Monday when he said the Fed may only need to raise interest rates once in 2019.
Based on the early price action, the direction of the March E-mini NASDAQ-100 Index the rest of the session is likely to be determined by trader reaction to the main Fibonacci level at 6485.75.
The jobs data lessened fears that the economy was slowing down. Powell’s comments relieved fears that the Fed may be making a policy error by tightening too fast. Both factors have contributed to the recent heightened volatility in the financial markets.
Traders said Powell’s comments were perceived as dovish because he said the Fed had no preset path for policy and could be patient when it comes to future interest rate hikes. Powell also acknowledged that inflation was muted and that the central bank would be in no hurry to raise rates. This marked the first time that Powell had used the word “patient”, something that former Fed Chair Janet Yellen used several times during her appointment.
On Friday, the Bureau of Labor Statistics released a report that showed nonfarm payrolls surged by 312,000 in December. This number destroyed the pre-report estimate of 176,000 jobs. Average Hourly Earnings also beat the forecast with wages jumping 3.2 percent from a year ago and 0.4 percent over the previous month. The Unemployment Rate rose to 3.9 percent, higher than the 3.6 percent estimate. However, this number rose because 419,000 new workers entered the workforce and the labor force participation rate increased 63.1 percent.
Although U.S. stock indexes are trading lower for the week, the sell-off has been orderly and without much fanfare. This may be a sign that we’re closer to a bottom than the headlines lead you to believe. I can build a case for a strong recovery in the stock market if this current pullback attracts new buyers in key support zones. In other words, I’d like to see new higher bottoms form. This will tell me that buyers have returned.
The first downside target on Thursday is the steep uptrending Gann angle at 6140.50. This is followed closely by the short-term retracement zone at 6114.75 to 6045.50. Watch for aggressive counter-trend buyers to show up on a test of this zone.
As we officially move into the year 2019, investors of all kinds are beginning to reevaluate their long-term strategies. There is no doubt that economic volatility and uncertainty has generally been on the rise, but—even with this said—there are still many important details that will need to be accounted for.
US equities were indicated to open lower in Thursday trading as Apple woe and fear of China’s slowing economy and growing economic troubles weigh on sentiment.
In the letter, Apple blamed a variety of factors for the lowered guidance, including a weakening economy in China and lower-than-expected iPhone revenue. Apple said the lower-than-anticipated revenue happened “primarily in Greater China,” but also said that upgrades to new iPhone models in other countries were “not as strong as we thought they would be.”
A recovery in crude oil prices helped trigger the initial rebound in the equity markets. Oil prices were bolstered by signs of tighter supplies from Saudi Arabia that offset record output in the United States and Russia. The S&P 500 Energy Sector rose 2.1 percent on the news, led by gains in Cabot Oil and Hess.
The major stock indexes posted their worst yearly performances since the financial crisis of 2008-2009. For the year, the S&P 500 Index and the Dow Jones Industrial Average were down 6.2 percent and 5.6 percent respectively. The NASDAQ Composite lost 3.9 percent in 2018.
Based on the early price action, the direction of the March E-mini NASDAQ-100 Index the rest of the session is likely to be determined by trader reaction to the main 50% level at 6358.75.
Today’s market action is going to be light, most institutional and big-money investors are away on holiday, and that should continue into the end of the week. There is very little economic data due save the NFP on Friday, and there are no earnings reports material to broad market performance.