NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Pulls Back As 10-Year Treasury Yield Hits 5%

SP500 Moved Lower As Treasury Yields Tested New Highs

SP500 is losing some ground as traders focus on dynamics of Treasury markets and monitor the situation in the oil markets.

The yield of 10-year Treasuries made an attempt to settle above the psychologically important 5.00% level as bond traders prepared for a rate hike at the Fed meeting on Wednesday. At this point, bond buybacks did not provide any support to Treasury markets.

Traders are worried that high oil prices will force the Fed to start the new rate hike cycle. According to FedWatch Tool, the probability of a rate hike at the upcoming meeting is 90.1%.

Oil prices tested new highs but lost momentum and pulled back as President Trump hinted that U.S. may restart negotiations with Iran. Earlier, oil prices rallied amid reports indicating that Saudi East-West Pipeline would not get back to work for several weeks after an attack.

President Trump also said that Russia and Ukraine agreed to halt attacks on energy infrastructure. I’d note that countries did not confirm that such a deal existed. Ukraine’s Zelenskiy said that his country was ready to stop attacks if Russia did not attack energy infrastructure. Russia was silent.

Consumer defensive and healthcare stocks were among the biggest gainers today as demand for safe-have assets increased. Basic materials found themselves under pressure amid pullback in precious metals markets. Tech stocks moved lower as traders focused on calls to slow down AI development.

Currently, SP500 is trying to settle above the 7650 level. In case this attempt is successful, SP500 will head towards the 50 MA at 7679. A move above the 50 MA will open the way to the test of the resistance at 7720 – 7730.

NASDAQ Rebounded From Session Lows As Traders Bought The Dip

NASDAQ moved lower as AI CEOs called for a slowdown of the technology’s development, talking about potential risks to humankind. It remains to be seen whether they see a serious threat or it’s a marketing stategy aimed to attract more attention.

NASDAQ managed to rebound from session lows as traders rushed to buy the dip. The pullback in Treasury yields, which moved lower after oil markets pulled back from session highs, providing additional support to the NASDAQ index.

If NASDAQ climbs above the 50 MA at 29,376, it will head towards the nearest resistance at 29,450 – 29,500. A move above the 29,500 level will open the way to the test of the next resistance at 29,750 – 29,800.

Dow Jones Pulled Back As Traders Focus On High Oil Prices

Dow Jones  is losing ground amid broad pullback in the equity markets. Goldman Sachs, which was down by -3.9%, was the biggest loser in the Dow Jones index today.

Dow Jones managed to settle above the support at 52,200 – 52,300 and is trying to settle above the 52,500 level. In case this attempt is successful, Dow Jones will head towards the resistance level at 52,800 – 52,900.

On the support side, a successful test of the support at 52,200 – 52,300 will open the way to the test of the next support at 51,600 – 51,700. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

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