NASDAQ Index, SP500, Dow Jones Forecasts – Traders Stay Bullish As Oil Dives 5%

SP500 Is Mostly Flat As Oil Retreats

SP500 is swinging between gains and losses as traders focus on developments in the Middle East and monitor the sell-off in the oil markets.

Oil markets are down by -5% as traders bet on Iran deal. WTI oil declined below the $89.00 level, while Brent oil settled below $95.00 despite Trump’s comments. President Trump said that he was not satisfied with talks and added that passage through the Strait of Hormuz should be free for all.

Iran wants to control the Strait of Hormuz together with Oman. Trump also added that Oman “will behave just like everybody else” or the U.S. will have to blow them up. The market does not believe that U.S. will attack Oman, so traders have ignored Trump’s hawkish comment.

Treasury yields are losing some ground as bond traders react to the strong sell-off in the oil markets. However, bond traders remain worried about Fed policy outlook and are not ready for aggressive purchases of U.S. bonds.

Consumer cyclical and consumer defensive stocks were among the biggest gainers today. Not surprisingly, energy stocks found themselves under strong pressure as traders reacted to the sell-off in the oil markets. Basic materials stocks have also moved lower amid pullback in precious metals markets.

SP500 remains stuck near the resistance level at 7515 – 7525. In case SP500 settles above the 7525 level, it will head towards the 7550 level. A move above this level will open the way to the test of the 7600 level.

On the support side, a move below the 7500 level will push SP500 towards the 50 MA at 7456. If SP500 declines below the 50 MA, it will move towards the support at 7425 – 7435.

NASDAQ Rebounds From Session Lows As Traders Buy The Dip

NASDAQ moved away from historic highs as traders took some profits off the table. Micron stock tested new highs as traders remained bullish after yesterday’s huge rally.

Traders stay focused on AI-related stocks and are ready to buy dips. At this point, traders ignore Fed policy outlook and geopolitical uncertainty.

In case NASDAQ settles below the 30,000 level, it will head towards the nearest support at 29,700 – 29,750. A successful test of this support level will open the way to the test of the 50 MA at 29,428.

On the upside, NASDAQ needs to settle above 30,000 to have a chance to gain upside momentum in the near term. In this case, NASDAQ will head towards the resistance level at historic highs at 30,300 – 30,350.

Dow Jones Moves Higher As Traders Focus On The Sell-Off In The Oil Markets

Dow Jones gained ground, supported by rising demand for consumer defensive and consumer cyclical stocks. Procter & Gamble, which was up by 3.3%, was the best performer in the Dow Jones index today.

Dow Jones failed to settle below the support at 50,400 – 50,500 and rebounded towards the 50,700 level. In case Dow Jones manages to settle above 50,700, it will head towards the nearest resistance level, which is located in the 51,000 – 51,100 range.

On the support side, a successful test of the support at 50,400 – 50,500 will push Dow Jones towards the 50 MA at 50,121.

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