NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Pull Back From Session Highs As Traders Focus On Powell’s Comments

SP500

SP500 pulled back from session highs as traders reacted to Fed decision and Powell’s comments. Fed decided to lower the target range for the federal funds rate by 25 bps. Powell noted that QT program would end in December and the Fed will keep its balance sheet unchanged for some time. Traders rushed to sell stocks after this comment. However, he later added that the balance sheet would not be frozen for a long time. Thus, Fed is almost ready to start QE, which is bullish for markets. Today, traders also had a chance to take a look at the Pending Home Sales report for September. The report indicated that Pending Home Sales declined by -0.9% year-over-year, compared to analyst forecast of +2.9%. It should be noted that most market sectors were under pressure in today’s trading session. Energy stocks were among the leaders in the SP500 index today as traders focused on rising oil markets.

From the technical point of view, SP500 needs to settle above the resistance at 6890 – 6900 to gain additional upside momentum in the near term. If SP500 settles above the 6900 level, it will move towards the 7000 level.

NASDAQ

NASDAQ managed to rebound from session lows after Powell talked about the potential start of the QE program. Traders should note that Microsoft, Alphabet, and Meta release their reports after market close, so they should be prepared for fast moves.

If NASDAQ pulls back below the 25,950 level, it will head towards the nearest support level, which is located in the 25,550 – 25,600 range.

Dow Jones

Dow Jones is swinging between gains and losses as traders focus on Powell’s press conference.

RSI has recently moved into moderate territory, so there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

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