Nasdaq Composite: Triple peak on iconic heavyweights of the index

(News Bulletin 247) – The Nasdaq Composite index (-1.12% to 11,883 points on Tuesday) is suffering from the warming of Treasuries 10 yrswhich now significantly exceed the psychological cap of 3%, in the wake of the very firm tone adopted by the central bankers at the end of last week, on the occasion of the symposium in Jackson Hole (Wyoming).

“The speech thus remained resolutely hawkish with little indication of a possible change of course, which contributed to accelerating the decline in the markets”, notes Thomas Giudici (Auris Gestion), who notes that the first slowdown in inflation, published last week, does not not change the course of the Fed.” This cut, although positive, is necessary but not sufficient to allow a change in the monetary policy of the Fed. The “pivot of the Fed” is therefore not for now.

This issue of monetary tightening weighs heavily on risky assets, and especially on Growth Files, which, after years of rallyare facing the beginnings of competition on the interest rate market.

“The outlook for higher inflation and weaker growth has put the Fed in a difficult position, but central bankers have used Jackson Hole to reaffirm that their primary objective remains to anchor inflation expectations by raising the federal funds rate quickly”, analyze Alison Boxer and Tiffany Wilding (PIMCO). “This approach has already produced the fastest rate of tightening of the monetary tap since the Lehman Brothers bankruptcy in 2008according to PIMCO’s U.S. Financial Conditions Index, and messages echoed in Jackson Hole reaffirmed that monetary policy tightening is here to stay despite the challenging growth outlook.”

The statistical week is clearly marked by employment, culminating on Friday with the monthly federal report (NFP for No Farm Payrolls). The job market, if it is dynamic if we stick to a few indicators without in-depth study, is dynamic, but it is not entirely healthy or optimal, in the sense that tensions persist. The new job vacancies (JOLTS) published yesterday showed an increase in the stock of available vacancies, well beyond expectations, while demand is not there, in a number of sectors, the logistics in particular. Tomorrow we will be able to assess the level of new weekly registrations for unemployment benefits, and in the immediate future, the operators are dealing with the survey by the private human resources firm ADP (Automatic Data Processing), which highlights the creation of 132,000 new posts, well below the consensus (300,000).

Nela Richardson, Chief Economist at consultancy ADP, commented on the latest survey: “Our data suggests a move towards a more traditional pace of hiring, likely as companies try to decipher the mixed signals from the economy. being at an inflection point, moving from superpowered job gains to something more normal.”

To follow at 3:45 p.m. the Chicago PMI activity barometer and at 4:30 p.m. crude stocks.

KEY GRAPHIC ELEMENTS

On marubozu black, in powerful volumes, the flagship index of technology stocks of the American dimension broke the neckline of a small figure in shoulder, head and shoulders, which signals the definitive end of the bullish leg started on June 17th. The index broke its 50-day moving average (in orange). The last time this technical event happened (08/04), the clearings accelerated: -23% until June 16, in a significant volatility.

Triple peaks are clearly emerging on iconic heavyweights of the index, like Tesla or NVidia. What in itself constitutes an alert.

FORECAST

In view of the key chart factors that we have identified, our opinion is neutral on the Nasdaq Composite index in the short term.

We will take care to note that a crossing of 13020.00 points would revive the tension in the purchase. While a break of 11460.00 points would relaunch the selling pressure.

CHART IN DAILY DATA

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