NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Gains Ground As Oil Markets Retreat

SP500 Moves Higher As Traders Focus On Economic Data

SP500 gains ground as traders react to economic reports and focus on falling oil prices.

CB Consumer Confidence declined from 90.2 (revised from 90.8) in July to 89.4 in August, compared to analyst forecast of 90.2. The report indicated that consumers were more pessimistic about business conditions and the labor market over the next six months.

New Home Sales decreased by -10.5% month-over-month in July, compared to analyst consensus of -1.3%. The previous report was revised from +1.6% to +7.6%. The revision of the previous report had a material impact on July data.

Traders also had a chance to take a look at the Case-Shiller Home Price Index report for June. The report indicated that home prices increased by +2.1% year-over-year, compared to analyst forecast of +1.7%.

Oil prices declined by -3.5% as President Trump announced that all mines have been removed from the Strait of Hormuz. He noted that any ships trying to put new mines would be destroyed.

Treasury yields moved lower as bond traders focused on falling oil prices. The yield of 2-year Treasuries declined below the 4.20% level, while the yield of 10-year Treasuries pulled back below 4.64%. Falling Treasury yields provided additional support to SP500.

Basic materials stocks were among the biggest gainers today as traders focused on rising copper markets. Utilities and real estate stocks gained ground as Treasury yields pulled back. Not surprisingly, energy stocks found themselves under pressure as oil markets suffered a sell-off.

If SP500 manages to settle above the 7690 level, it will head towards the nearest resistance level, which is located in the 7720 – 7730 range. On the support side, a move below the 7650 level will push SP500 towards the support at 7615 – 7625. If SP500 declines below 7615, it will move towards the next support at 7525 – 7535.

NASDAQ Gains Ground As Treasury Yields Pull Back

NASDAQ moved higher as demand for tech stocks increased. That said, it should be noted that NASDAQ failed to gain significant upside momentum. Traders remain worried about higher valuations of AI-related stocks.

The nearest support level for NASDAQ is located in the 29,100 – 29,150 range. If NASDAQ pulls back below the 29,100 level, it will head towards the next support level at 28,700 – 28,750. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in the near term.

On the upside, a move above the 29,300 level will push NASDAQ towards the resistance at 29,450 – 29,500. If NASDAQ climbs above 29,500, it will head towards the 50 MA at 29,592.

Dow Jones Attempts To Settle Above 53,500

Dow Jones moved higher in choppy trading. Merck, which was up by +3.6%, was the biggest gainer in the Dow Jones index today. The stock moved higher as traders remained focused on the company’s cancer vaccine.

If Dow Jones stays above the support at 53,300 – 53,400, it will head towards the nearest resistance level, which is located in the 53,900 – 54,000 range. On the support side, a successful test of the 53,300 level will open the way to the test of the next support level at 52,800 – 52,900.

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