NASDAQ Index, S&P 500 and Dow Jones Forecasts – US Indices Look to Recover

NASDAQ 100 Technical Analysis

The Nasdaq 100 has rallied slightly during the early hours on Friday as it looks like we are trying to turn things around and bounce. That being said, it was a horrific day on Thursday, absolutely coming unraveled. I think any bounce here has to be looked at with a little bit of suspicion. My plan actually is to sit and watch this on Friday and not really do anything because you also have to deal with the weekend.

We broke a major trend line going back to the middle of May over the last couple of days, and most certainly on Thursday. I think we are in a state of flux. We’ll have to see whether or not we can continue to the upside. But right now, this looks like a dangerous setup, and therefore it’s probably best to observe it.

Dow Jones 30 Technical Analysis

The Dow Jones 30 might be a little bit more stable, but at the end of the day, you would have to at least take out the 50-day EMA to the upside to even begin to have the conversation about buying this market. This doesn’t necessarily mean that I want to short this market; in fact, I don’t, but it means that we’ve seen an incredible amount of damage over the last five or six trading sessions, and therefore, there’s no need to be the first person through the door to try to be the hero. Let the market bounce, then take advantage of that.

S&P 500 Technical Analysis

The S&P 500 initially fell during the early hours on Friday, only to turn around and bounce. It looks like the 6,500 level will offer a bit of support, and I think a lot of people will look at it as such. The market has seen buyers in that area previously, so bouncing from here is not a huge surprise. However, we broke through a major trend line this week, and now I think the best-case scenario is that we go sideways for a while.

With that being the case and the fact that it is Friday, I’m not willing to put a bunch of money at risk on a Friday just for what could end up being an ugly Monday with the wrong headline over the weekend. We don’t have a lot of confidence in the market over the last week or two. A little bit of patience probably goes a long way. I remain bullish longer term, but right now it looks like there are a lot of questions being asked.

For a look at all of today’s economic events, check out our economic calendar.