|Day's Range||7,356.94 - 7,458.06|
|52 Week Range||5,895.12 - 7,700.56|
Growth outlook, Brexit Chaos, and Trade fears weigh on global indices with no end to the turmoil in sight.
The key level to watch today is the minor bottom at 7349.50. The market hit this low early Wednesday on renewed concerns over U.S.-China relations.
“The fed funds futures market is assigning a 47.8 percent probability of at least one rate cut by January 29, 2020,” according to the CME’s FedWatch tool.
Supporting the U.S. stock markets early in the session were the start of the U.S. Federal Reserve monetary policy meeting. Going into Wednesday’s key Fed announcements, investors are pricing in zero chance of a rate hike. Additionally, investors aren’t looking for much change in the central bank’s monetary policy statement.
FOMC meeting in sharp focus, Brexit Blocked, markets flat but big moves are in store.
The divergence between the Dow and the other major indexes can be explained by the plunge in shares of Boeing. However, as far as Facebook is concerned, investors have to remember that this stock began to weaken months before the broad-based sell-off began in October 2018. This is something to keep in mind as we approach first quarter earnings season, which is already raising concerns about growth.
Another FOMC meeting comes into focus while traders wait anxiously for news on U.S./China trade talks.
Based on last week’s close at 7343.25, the direction of the June E-mini NASDAQ-100 Index the rest of the week is likely to be determined by trader reaction to a price cluster at 7383.00 to 7383.25.
The Pound was the leader of the pack, with a vote against a no-deal departure and a Brexit extension providing much-needed support.
Investors continued to grow impatient of the process to construct a trade deal between the two economic powerhouses. The two countries are still expected to reach a deal, however, optimism may be fading. This could put short-term pressure on the markets. New Home Sales missed the estimate, falling 6.9 percent in January. Traders said the government shutdown may have kept buyers on the sidelines. Facebook shares slid 1.9 percent after a worldwide outage of its core app, Instagram and WhatsApp.
No-Deal Brexit is off the table, at least that’s what the UK says, but it may not matter. If the EU doesn’t agree the UK may have no choice.
Based on the early price action, the direction of the March E-mini NASDAQ-100 Index is likely to be determined by trader reaction to the downtrending Gann angle at 7317.00.
So while the solid U.S. economic data allows the Fed to sit back and be “patient”, U.S. stock market investors can continue to buy with confidence. In the meantime, Chinese investors have to sit back and wait for the hundreds of billions of dollars in additional tax cuts and infrastructure spending to work its way through the economy. That is, of course, unless a trade deal is reached over the near-term.
May’s Brexit deal gets voted down again, now lawmakers must decide what to do next and that decision will move the market.
Based on Tuesday’s price action, the direction of the March E-mini NASDAQ-100 Index on Wednesday is likely to be determined by trader reaction to the former main top at 7211.50.
Theresa May secured legally binding changes to the Irish Backstop but the AG says its not enough to protect the UK.
Risk appetite jumped early Tuesday as speculative buyers reacted positively to the news that U.K. Prime Minister Theresa May might be closer to securing approval for her Brexit deal.
After consolidating near the opening, the Dow Jones Industrial Average rebounded on the back of a 3.47 percent gain in Apple shares. The rally in the communications giant and Dow component helped offset some of Boeing’s losses. The catalyst behind the rally was Bank of America Merrill Lynch’s upgrade of the stock to buy from neutral.
Based on the current price at 7028.50, the direction of the March E-mini NASDAQ-100 Index on Monday is likely to be determined by trader reaction to the 50% level at 7026.25.