The three major US indices continue to wait for the Jackson Hole speech by Jerome Powell on Friday, to get a feel for where the monetary policy of the Federal Reserve is heading.
The NASDAQ 100 initially fell during early trading on Friday, but you can see that we have bounced from the significant trend line. And of course, it looks like we are going to try to break back above the 23,250 level. If we can break above there, then the 24,000 level could be targeted over the longer term. Keep in mind that everybody’s waiting around for the speech by Jerome Powell and whether or not he’s going to look to cut rates soon. So, expect volatility.
The Dow Jones 30 also fell a bit, only to turn around and show signs of life, but we continue to sit just below the 45,000 level. The 45,000 level of course is a large round psychologically significant figure and an area where we have seen a lot of resistance in the past. Really at this point, if we can finally break above here, the Dow Jones 30 finally has a shot to go much higher, and do expect volatility, but if we pull back, I’d be looking somewhere around the 44,000 level for buyers to return and try to get involved in the market again.
The S&P 500 pulled back just a bit, only to turn out to show signs of life, like it wants to break above the 6400 level. If we can break above there, then the 6500 level would be the next target. But ultimately, this basically comes down to the speech coming out of Jackson Hole by Jerome Powell, because if he rattles the market, we could drop to the 50 day EMA rather quickly. Regardless, this is a market that is on an uptrend, has been in an uptrend, and probably will remain in an uptrend as traders are looking for the Federal Reserve to loosen monetary policy in order to give Wall Street that cheap money that it thrives on.
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Chris is a proprietary trader with more than 20 years of experience across various markets, including currencies, indices and commodities. As a senior analyst at FXEmpire since the website’s early days, he offers readers advanced market perspectives to navigate today’s financial landscape with confidence.