NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Tests Key Resistance As Tesla Gains 3%

SP500

SP500 gains ground as traders react to PPI reports and comments from Fed Chair Jerome Powell. PPI and Core PPI increased by 0.5% month-over-month in April, exceeding analyst expectations. Importantly, the previous report was revised from +0.2% to -0.1%. Powell said that the current federal funds rate is restrictive by many measures, but Fed needs more time to decide whether it is sufficiently restrictive. Powell has also noted that another rate hike was an unlikely scenario. Traders viewed Powell’s comments as dovish. Stocks moved higher, while Treasury yields declined.

Currently, SP500 is trying to settle above the 5250 level. RSI is close to the overbought territory, but there is enough room to gain additional upside momentum. A move above 5250 will push SP500 towards the next resistance at 5270 – 5280.

NASDAQ

NASDAQ tests key resistance at 18,300 – 18,400 as traders focus on dovish comments from Fed Chair Powell. The rally is led by Tesla, which is up by 3% in today’s trading session. Fed policy outlook is one of the key drivers for tech stocks, so traders increase purchases of tech shares as Treasury yields are moving lower.

A successful test of the resistance at 18,300 – 18,400 will provide NASDAQ with an opportunity to test historic highs.

Dow Jones

Dow Jones is moving higher as traders focus on general market sentiment. There are no big gainers or losers in the Dow Jones index today. Intel  gained 1.4% as the stock continued to rebound from multi-month lows.

In case Dow Jones settles above the recent highs at 39,655, it will head towards the next resistance level, which is located in the 39,900 – 40,000 range. A move above the 40,000 level will signal that Dow Jones is ready to gain additional upside momentum.

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