NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Move Away From Session Lows As Traders Buy The Dip

SP500 Rebounds From Session Lows On Dip-Buying

SP500 has started to rebound after the sell-off, which was triggered by the strong rally in the oil markets.

WTI oil made an attempt to settle above the $78.00 level as traders focused on the war in the Middle East. The market has started to prepare for a long war, which means that oil prices could remain at high levels for weeks.

Traders are ready to buy strong dips. At some point, the conflict in the Middle East will end, and energy prices will decline, which will be bullish for SP500.

The duration of the conflict will likely serve as the key catalyst for stocks. The market is prepared for short-term disruptions in oil and natural gas markets. However, it is not clear whether it is prepared for a long-term disruption or an additional escalation of the conflict.

All market sectors moved lower in today’s trading session. Basic materials stocks were among the biggest losers today as traders reacted to the sell-off in precious metals markets. Gold was down by 4%, while silver declined by more than 7%.

Industrials stocks have also found themselves under strong pressure as traders worried that rising energy prices would hurt global economy.

From the technical point of view, SP500 has recently managed to settle back above the support at 6780 – 6790 and made an attempt to settle above the 6840 level. A move above 6840 will push SP500 towards the nearest resistance, which is located in the 6870 – 6880 range.

NASDAQ Attempts To Settle Back Above 24,750

NASDAQ has also moved away from session lows. Micron, which was down by 8%, was the biggest loser in the NASDAQ index today.

Interestingly, software stocks managed to gain ground in today’s trading session. Workday, Atlassian, and Adobe were among the biggest gainers. Traders used the strong pullback as an opportunity to establish long positions at attractive levels. From a big picture point of view, traders bet that AI would not destroy the businesses of these companies.

Currently, NASDAQ is trying to settle above the resistance at 24,700 – 24,800. In case this attempt is successful, NASDAQ will move towards the 50 MA at 24,905. In case NASDAQ climbs above the 50 MA, it will head towards the next resistance level at 25,200 – 25,250.

Dow Jones Moves Away From Session Lows As Traders Bet On A Rebound

Dow Jones rebounded from session lows as traders rushed to buy the dip. However, the index failed to move back into positive territory and remains under pressure.

IBM and Salesforce were the biggest gainers in the Dow Jones index today. Traders buy stocks that have recently suffered huge sell-offs.

Caterpillar and Boeing found themselves under strong pressure amid falling demand for industrials stocks. Traders are worried about a potential economic slowdown, which would be triggered by high energy prices.

It should be noted that rising energy prices could push inflation towards higher levels and force the Fed to be more hawkish, which would be bearish for stocks.

The nearest resistance level for Dow Jones is located in the 48,700 – 48,800 range. A move above the 48,800 level will push Dow Jones towards the 50 MA at 49,055. In case Dow Jones climbs above the 50 MA, it will head towards the next resistance at 49,500 – 49,600.

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