NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Rally After Fed Decision

SP500

SP500 rallied as traders reacted to Fed decision and Powell’s comments during the press conference. The interest rate was left unchanged but Fed announced that it would reduce the monthly redemption cap on Treasury securities from $60 billion to $25 billion. Treasury yields pulled back as Fed would slow the pace of asset sales. During the press conference, Powell noted that another rate hike was an unlikely scenario. At this point, Fed is not sure when it starts cutting rates. From a big picture point of view, Powell said nothing new. In fact, Fed is not sure when it should start the rate cut cycle. However, it looks that traders were worried that a rate hike was on the table during Fed discussions.

Currently, SP500 is trying to settle above the resistance at 5100 – 5110. In case SP500 manages to settle above the 5110 level, it will move towards the next resistance, which is located in the 5180 – 5190 range.

NASDAQ

NASDAQ rallied as traders rushed to buy tech stocks after the release of Fed decision. The rally is extremely broad, and most stocks in the NASDAQ index are moving higher. Starbucks, which is down by 16.5%, is a rare exception. The stock found itself under strong pressure as the company’s Q2 same-store sales declined.

From the technical point of view, NASDAQ is moving towards the resistance at 17,800 – 17,900. A move above 17,900 will push NASDAQ towards the next resistance at 18,300 – 18,400.

Dow Jones

Dow Jones gained ground amid a broad rally in the equity markets. The rally was led by Amazon, which gained 5.1% in today’s trading session.

In case Dow Jones settles above the 50 MA at 38,223, it will head towards the nearest resistance level, which is located in the 38,500 – 38,550 range.

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