(News Bulletin 247) – The Omicron and Evergrande files have not finished causing volatility on the most sensitive indices, of which the Nasdaq Composite, by nature richly represented in growth stocks, is one. The flagship index of technology stocks on the US rating yesterday gained 0.64% to 15,786 points. It is expected to drop slightly on Thursday. While relief is on the health front, the thorny Chinese real estate file painfully resurfaces, with the default of Kaisa and Evergrande.
It is in this rather cool atmosphere that the Fed will approach its next Monetary Policy Council next week. To fuel its reflection, it will have at its disposal, from tomorrow, the latest inflation figures within the meaning of consumer price indicators. Excluding food and energy (the most volatile elements), prices are expected to increase monthly by 0.5%.
Because it is the question of the pace of monetary tightening in 2022 that will be a powerful determinant. “The question of the number of rate hikes is at the heart of the debates. [Les opérateurs ] “now foresee three rate hikes next year, while maintaining those anticipated for 2023. The possible change in the Fed’s monetary policy trajectory has triggered a sharp increase in market volatility”, for Mabrouk Chetouane, director Research and Strategy of BFT Investment Managers. However, this number of expected increases may change rapidly, creating volatility on the index.
In the immediate future, the operators have just learned of the weekly registrations for unemployment benefits, in contraction stronger than expected, to 184,000 new registrations according to the latest figures from the Department of Labor.
KEY GRAPHIC ELEMENTS
Regarding the substantive technical framework, at this stage unchanged:
Since October 28 and the registration of new historic highs after those of September 07, the flagship index of technological stocks of the American stock market has systematically closed on the high points of the session, in strong volumes, which contracted only very little . The buying side, fully mobilized, does not ask any questions. Short term:
The entry into a digestion phase, the structure of which will be instructive for the future, should be considered. We are still in the process of defining the framework, and the amplitude, of future consolidation. A broader consolidation is looming. A first bearish acceleration within this consolidation was expressed, Tuesday, and Wednesday, in a larger amplitude but less strong volumes.
Negative opinion on the scale of the only session to come. The ability to “hold” the 15,000 points will be essential. This was the case at the turn of the week, in low shade. An obvious inability to make a bullish extension today would validate the idea of ​​continued volatility, with new monthly lows reaching.
PREVISION
In view of the key graphical factors that we have mentioned, our opinion is negative on the Nasdaq Composite index in the short term.
This bearish scenario is valid as long as the Nasdaq Composite Index quotes below resistance at 16212.00 points.
DAILY DATA CHART
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Source: Tradingsat
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