NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Pulls Back Amid Profit-Taking And Middle East Uncertainty

SP500 Is Losing Ground As Traders Take Profits

SP500 pulled back as traders waited for Iran’s response to U.S. proposal to end the war in the Middle East and took some profits off the table after the strong rally.

Oil prices rebounded from session lows as oil traders waited for news from the Middle East. WTI oil settled near the $96.00 level, while Brent oil climbed back above the psychologically important $100.00 level.

Today, traders had a chance to take a look at the Initial Jobless Claims report. The report indicated that 200,000 Americans filed for unemployment benefits in a week, compared to analyst consensus of 205,000. The report showed that the job market remained in decent shape despite high energy prices.

Rising Treasury yields put some pressure on stocks today. The yield of 2-year Treasuries rebounded above the 3.91% level, while the yield of 10-year Treasuries moved above 4.39%.

The key question is whether the yield of 30-year Treasuries manages to settle above the important 5.00% level, which could trigger a sell-off in bond markets.

The pullback was broad, and all market sectors moved lower in today’s trading session. Energy stocks were among the biggest losers as traders focused on oil price dynamics. Industrials and utilities stocks have also found themselves under material pressure.

SP500 failed to settle above the 7390 level and pulled back below 7350. In case SP500 stays below the resistance at 7350 – 7360, it will head towards the 7300 level. A move below 7300 will push SP500 towards the support level at 7270 – 7280.

NASDAQ Pulls Back From Historic Highs

NASDAQ moved lower as traders decided to take some profits off the table near historic highs.

Datadog, which was up by 30%, was the biggest gainer in the NASDAQ index today. The stock rallied as the company’s quarterly report showed that its revenue increased by 32%. Not surprisingly, analysts rushed to upgrade the stock.

Chip stocks found themselves under pressure amid profit-taking. Arm Holdings declined by 10.4% as traders reacted to the company’s earnings report.

In case NASDAQ settles back below the 28,500 level, it will head towards the support, which is located in the 28,100 – 28,150 range. A move below the 28,100 level will open the way to the test of the next support at 27,750 – 27,800.

Dow Jones Attempts To Settle Below 49,500

Dow Jones declined amid broad pullback in the equity markets. Caterpillar, which was down by 4.1%, was the worst performer in the Dow Jones index today. The stock moved lower as traders decided to take some profits off the table after the strong rally.

From the technical point of view, Dow Jones failed to settle above the resistance at 49,700 – 49,800 and pulled back towards the 49,500 level. In case Dow Jones manages to settle below the 49,500 level, it will head towards the 50 MA at 49,357. A move below the 50 MA will push Dow Jones towards the support level at 49,000 – 49,100.

On the upside, Dow Jones needs to settle back above the 49,800 level to have a chance to gain sustainable upside momentum in the near term. In this case, Dow Jones will get to the test of the 50,000 level. A move above 50,000 will open the way to the test of the 50,500 level.

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