Nasdaq Futures Try to Reclaim Thursday’s AI Loss
December E-mini Nasdaq-100 Index futures are higher early Friday after Thursday’s OpenAI revenue report broke the AI trade lower. Buyers are taking a shot at a recovery off chart support, but one early bounce doesn’t prove the selling is over.
The report took some of the air out of the stocks that have carried the advance, while the Dow held together better than the technology-heavy indices.
At 07:54 GMT, December E-mini Nasdaq-100 Index futures were trading at 31,234.75, up 265.25 or 0.86%. Dow futures were up 105 points, or 0.2%, while S&P 500 futures gained 0.3%.
Daily December E-mini Nasdaq-100 Index Futures Technical Analysis
December E-mini Nasdaq-100 Index futures are edging higher during the pre-market session on Friday. The market is trying to recover from a steep sell-off the previous session.
The main trend is up according to the daily swing chart. A trade through 31616.50 will signal a resumption of the uptrend. The main trend changes to down if the swing bottom at 30356.75 is taken out.
Near-term support at 30986.75 to 30838.00 was successfully tested on Thursday. Upside momentum could return on a sustained move over 30986.75. A break through 30838.00 will be a sign of weakness. If this move creates enough downside momentum, then the selling could extend into the next retracement zone support at 30334.75 to 30032.25. Inside this area is the 50-day moving average at 30111.60.
Daily December E-mini Dow Jones Industrial Average Technical Analysis
December E-mini Dow Jones Industrial Average futures are edging higher early Friday. The main trend is down according to the daily swing chart. A trade through 51965 will change the main trend to up. A move through 50859 will signal a resumption of the downtrend.
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See all NASDAQ 100 forecastsThe contract range is 46248 to 55283. Its retracement zone at 50766 to 49699 is a major support area. Last week’s main bottom at 50859 and this week’s minor bottom at 50909 came in just above the upper or 50% level of the zone.
The next range is 50859 to 51965. Trader reaction to its 50% level at 51412 is likely to set the tone today. The E-mini Dow is currently trading on the strong side of this level.
Another main range is 52844 to 50859. Its retracement zone at 51852 to 52086 is another target area. Clearing 52086 will put the E-mini Dow in a strong position. If this creates enough upside momentum, then look for a potential surge into the price cluster formed by the 50-day moving average at 53062 and a 50% level at 53071.
OpenAI Revenue Reset the AI Conversation
OpenAI told investors it had reached $50 billion in annualized revenue at the end of September. The number was below the $68 billion figure reported last month, although that earlier figure included gross revenue from partners. Traders did not wait around to sort out the distinction.
CoreWeave fell more than 7% Thursday. Oracle, Intel and Super Micro Computer each lost about 5%. Advanced Micro Devices gave up nearly 4% and Nvidia dropped almost 3%. Nobody in the group got a pass.
The Nasdaq Composite Index closed down 1.25% at 27,193.34, its biggest one-day loss since mid-August.
The market has been pricing in a huge payoff from AI spending. Thursday didn’t kill that story, but it made traders take another look at the revenue path that has been supporting the valuations. The names with the most to prove were the first ones offered.
The Dow Held While Tech Took the Hit on Thursday
The Dow Jones Industrial Average added 51.77 points, or 0.1%, to close at 51,231.64 on Thursday. The S&P 500 Index fell 0.47% to 7,765.36. That split tells you the selling was not broad liquidation. Buyers were willing to own other stocks while the high-flying AI group was getting repriced.
Palantir gained 2% after Goldman Sachs upgraded the stock, citing potential demand from sovereign AI and bespoke applications. After the bell, SpaceX rose 2% on a deal to buy a nationwide spectrum portfolio. AT&T, Verizon and T-Mobile moved lower as traders looked at the competitive threat from that deal.
The Dow and the Nasdaq Composite were both roughly flat for the week through Thursday. The S&P 500 was headed for a 0.6% weekly gain. Outside the AI leaders, the market isn’t showing much stress.
Oil and Long-Term Rates Are Still a Problem
Tech had oil and yields working against it too. Brent crude oil settled 4.07% higher at $104.28 a barrel and West Texas Intermediate crude oil rose 3.64% to settle at $91.49 on renewed concern about the Middle East conflict. Prices came off their highs after President Donald Trump said the United States would not attack Iran before the November 3 midterm elections.
Treasury yields eased Thursday after a solid auction. It didn’t change much. The 10-Year U.S. Treasury yield and the 30-Year are still close to the 24-year highs they hit earlier in the week.
Expensive oil and high long-term rates were easy to ignore while the AI numbers kept getting bigger. Thursday’s revenue report took that cover away.
What to Watch
Delta Air Lines reports before the opening bell Friday, followed by October consumer-sentiment data. Neither is likely to matter as much as the Nasdaq today.
Nasdaq buyers own the early recovery after Thursday’s break. With crude running higher and long-term yields hanging near their peaks, the technology leaders can’t afford another letdown.
Nasdaq-100 futures are building on Thursday’s successful test ahead of the New York open, and the bias is still to the upside. It’s 30,838.00 that changes the call. The main trend doesn’t turn down until 30,356.75 goes.
The E-mini Dow is the more complicated chart. The main trend is down, but buyers look to be supporting last week’s and this week’s bottoms. Trader reaction to 51,412 sets the tone today. The recovery doesn’t get real upside momentum until 52,086 goes.
More Information in our Economic Calendar.
