S&P 500, SPX, NASDAQ 100, NDX, DJIA – OUTLOOK:
- The S&P 500 and DJIA have fallen beneath key help.
- The Nasdaq 100 index dangers a bearish head & shoulders sample.
- What are the outlook and the important thing ranges to observe within the three US indices?
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The rally in US indices seems to be cracking – the S&P 500 and the Dow Jones Industrial Average (DJIA) have damaged beneath key help, whereas the Nasdaq 100 index appears weak amid a possible bearish formation. For extra dialogue on the elemental drivers, see “US Indices Risk Support Test After Hawkish Fed: S&P 500, Nasdaq Price Action,” printed September 21.
S&P 500: Falls beneath key help
The S&P 500 has fallen beneath an important converged help, together with the June low of 4325, the 89-day shifting common and the decrease fringe of the Ichimoku cloud on the every day charts –a threat highlighted within the final week’s replace. The break is crucial because the higher-top-higher-bottom sequence because the starting of the yr has been damaged. The break has opened the way in which towards the 200-day shifting common initially, now at about 4195. Below that, the subsequent help is on the end-April low of 4050.
S&P 500 Daily Chart
Chart Created by Manish Jaradi Using TradingView
The evolving value motion additional reinforces the broader fatigue on increased timeframe charts, as identified in earlier updates. See “US Indices Hit a Roadblock After Solid Services Print: S&P 500, Nasdaq,” printed September 7; “US Indices Rally Beginning to Crack? S&P 500, Nasdaq Price Setups,” printed August 3; “S&P 500, Nasdaq 100 Forecast: Overly Optimistic Sentiment Poses a Minor Setback Risk,” printed July 23.
Nasdaq 100: Head & Shoulders Risk
The Nasdaq 100 index is testing a vital horizontal trendline from June (at about 14550-14560). Any break beneath would set off a head & shoulders sample – the left shoulder is on the June excessive, the top is on the July excessive, and the fitting shoulder is on the early-September excessive. If triggered, the value goal of the bearish sample could be round 13200, close to the 200-day shifting common.
Nasdaq 100 Daily Chart
Chart Created by Manish Jaradi Using TradingView
Moreover, from a big-picture perspective, as highlighted in arecent replace, the momentum on the month-to-month charts has been feeble in contrast with the massive rally since late 2022, elevating the chance of a gradual weakening, just like the gradual drift decrease in gold since May. For extra dialogue, see “Is Nasdaq Following Gold’s Footsteps? NDX, XAU/USD Price Setups,” printed August 14.
Dow Jones Industrial Average Weekly Chart
Chart Created by Manish Jaradi Using TradingView
Dow Jones Industrial Average: Cracks beneath help
After a bullish break in July, the Dow Jones Industrial Average did not maintain positive aspects. This week the index has fallen beneath the resistance-turned-support on a horizontal trendline from July (at about 34300). The break has opened the way in which initially towards the May low of 32600, probably the 200-week shifting common (now at 31720), coinciding with the March low.
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— Written by Manish Jaradi, Strategist for DailyFX.com
— Contact and comply with Jaradi on Twitter: @JaradiManish
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