S&P 500 (SPX), Dow Jones (DJI), Nasdaq Composite (IXIC) Daily Technical Outlook: Bond Shifts, Tech Rises, and the DJI’s Triple Bottom Play

Key Insights

• Wall Street shows optimism; U.S. Treasury selloffs moderate and GE, Coca-Cola stocks rise notably.
• Bill Ackman exits bearish stance on U.S. bonds, reflecting a shift in market sentiments.
• Major tech firms, including Apple, Tesla, and Amazon, experience stock rises from 0.2% to 2.4%.
• Earnings reports from tech giants anticipated to reflect strong revenue growth.
• S&P 500 remains below its 50-day EMA, suggesting a short-term bearish trend.

Quick Fundamental Outlook

Wall Street was poised for a positive start as U.S. Treasury selloffs moderated. Notably, General Electric and Coca-Cola stocks rose due to optimistic forecasts, with jumps of 5.9% and 2.8%, respectively. General Motors and 3M also saw growth after revealing positive profit forecasts. The 10-year Treasury note yield settled at 4.8504%, after crossing 5% earlier.

Bill Ackman of Pershing Square, known for his bearish stance on U.S. bonds, recently exited his position, indicating changing market sentiments. As interest rate effects become evident, significant tech firms like Apple, Tesla, and Amazon observed stock rises between 0.2% and 2.4%.

Upcoming earnings reports from tech giants are anticipated to show robust revenue growth. To date, 78% of S&P 500 companies have exceeded earnings expectations this quarter.

S&P 500

The S&P 500 (SPX) witnessed a subtle upward movement on October 24, with its price settling at 4217.03, a marginal gain of 0.17% over the day. Analyzing the 4-hour chart, the pivot point for the index is noted at $4271.

On the upside, resistances are spotted at $4342, $4400, and $4464, while on the downside, supports are seen at $4216, $4173, and $4120.

Diving into the technical indicators, the Relative Strength Index (RSI) stands at 33. This value, being below the neutral 50 mark, signifies a bearish sentiment.

Concurrently, the Moving Average Convergence Divergence (MACD) posts a value of -14.72, with its signal line at -22.80. This configuration suggests that the MACD line has recently surged above the signal, hinting at a potential upward momentum.

However, the 50-Day Exponential Moving Average (EMA) sits at $4329, and with the SPX trading below it, a short-term bearish trend is indicated. Chart patterns further corroborate this sentiment. The presence of a downward channel, complemented by the “Three Black Crows” pattern and the position relative to the 50 EMA, all lean towards a bearish trend.

In conclusion, while the overall trend for the SPX seems bearish beneath the $4270 mark, the near-term might see the asset challenging the immediate resistance at $4342.

NASDAQ

On October 24, the NASDAQ registered a price of 13018.33, marking a modest increase of +0.27% within a 24-hour window. Delving into the 4-hour timeframe, the pivot point is identified at $13249.

To the upside, investors should be watchful of resistance levels at $13600, $13976, and $14214. Conversely, the index has immediate support at $12919, followed by $12614 and $12422.

A closer look at the technical indicators reveals that the Relative Strength Index (RSI) is valued at 35. Being below the midpoint of 50, this suggests a prevailing bearish sentiment in the market.

The Moving Average Convergence Divergence (MACD) posts a value of 25.68, while its signal line is at 50.12, indicating that the MACD line is currently below the signal line, further hinting at potential downward momentum.

The 50-Day Exponential Moving Average (EMA) stands at $13389. With the NASDAQ trading below this figure, a short-term bearish trend is evident.

Chart patterns, such as the downward channel, the “Three Black Crows”, and the position relative to the 50 EMA, reinforce the bearish outlook. However, the $12900 level is emerging as a formidable support, resisting further declines.

In conclusion, the NASDAQ appears bearish beneath the $13249 threshold. In the short term, it may be poised to challenge the immediate resistance at $13600, depending on market dynamics.

Dow Jones

As of October 24, the Dow Jones Industrial Average (DJIA) stands at 33066, marking a rise of +0.30% within a 24-hour frame. Analyzing the 4-hour chart, we identify the pivot point at $32856.

On the upside, the immediate resistance is situated at $33238, followed by further challenges at $33571 and $34025. Conversely, the index finds immediate support at $32595, with deeper cushions at $32347 and $31993.

Turning to the technical indicators, the Relative Strength Index (RSI) is positioned at 37, suggesting a prevailing bearish sentiment as it’s below the 50-mark.

The chart exhibits a ‘Triple Bottom’ pattern with a crucial support level at 32,850. This suggests that above this level, buying interest might dominate, while below it, selling pressure could intensify.

In conclusion, the Dow Jones presents a bearish stance below the $32850 mark. In the short run, there’s an anticipation that the index might approach the resistance at $33238, contingent on upcoming market developments.

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