NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Rebound As Trump Says War Could End Soon

SP500 Rebounds, Supported By Trump’s Comments

SP500 rebounded from session lows as traders focused on dynamics of oil markets and geopolitical developments.

The son of Ali Khamenei, who was killed in the first hours of the operation against Iran, was elected as Iran’s new Supreme Leader. Analysts expect that Mojtaba Khamenei will take a hardline approach.

WTI oil made an attempt to settle above the $120 level as Gulf countries were forced to cut production. The Strait of Hormuz remains closed. As a result, Iraq, Kuwait, UAE and Saudi Arabia were forced to cut output due to lack of storage. The situation will get more complicated in case the war in the Middle East lasts for weeks.

Oil prices have started to move lower as G7 countries discussed the potential release of oil from strategic reserves to cool prices. No decision has been made yet, but verbal interventions put significant pressure on oil prices. WTI oil pulled back towards the $90.00 level in an epic intraday reversal.

In an interview to CBS, President Trump said that the war against Iran could end soon. These words will provide material support to equity markets and put pressure on oil prices.

Not surprisingly, energy stocks were among the biggest gainers in the SP500 index today. Tech stocks have also managed to gain upside momentum as traders were ready to buy the dip. Financial and consumer cyclical stocks were among the losers as traders worried about the negative impact of high oil prices.

From the technical point of view, SP500 is heading towards the resistance at 6780 – 6790. In case SP500 manages to settle above the 6790 level, it will move towards the 50 MA at 6825. RSI is in the moderate territory, so there is plenty of room to gain momentum in the near term.

NASDAQ Tests The 50 MA At 24,854

NASDAQ gained upside momentum as traders reacted to the pullback in the oil markets and bet that the conflict in the Middle East could end soon.

NASDAQ moved above the resistance at 24,700 – 24,750 and is trying to settle above the 50 MA at 24,854. If NASDAQ settles above the 50 MA, it will move towards the next resistance level, which is located in the 25,200 – 25,250 range.

On the support side, a move below the 24,600 level will push NASDAQ towards the nearest support at 24,200 – 24,250.

Dow Jones Gains Ground As Traders React To The Pullback In Oil Markets

Dow Jones has also moved higher as traders focused on Trump’s words and the situation in the oil markets.

Traders bet that the strong rally in the oil markets will force the U.S. to stop the operation against Iran.

Currently, Dow Jones is trying to settle above the resistance at 47,100 – 47,200. If Dow Jones manages to settle above the 47,200 level, it will head towards the next resistance, which is located in the 47,900 – 48,000 range. A move above the 48,000 level will push Dow Jones towards the 50 MA at 48,389.

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