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Tuesday, January 31, 2023
HomeMarketsNasdaq Composite: American consumer confidence, an essential key

Nasdaq Composite: American consumer confidence, an essential key

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(News Bulletin 247) – Hesitating yesterday, after 4 sessions of pronounced decline, the Nasdaq Composite ended in equilibrium, close to 10,550 points, in declining volumes, after major monetary maturities, and with the approach of publications sharp statistics.

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As a reminder last week, J Powell took the markets on the wrong foot by adopting a belligerent tone in a post-FOMC press conference. “I wouldn’t see us considering rate cuts until the committee is confident that inflation is down to 2% sustainably,” he said.

“Fed watchers appear to have moved away from concerns about the pace of rate hikes and the final level of rates, to instead wondering how long interest rates will remain at restrictive levels,” the team said. strategy of Muzinich & Co.

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As a reminder, Fed members raised their rate projections to 5.1% for 2023 and 4.1% for 2024, from 4.6% and 3.9% respectively at their September meeting. They also anticipate higher inflation, at 3.1% for 2023, against 2.8% previously, and at 3.5% for “core” inflation, i.e. excluding the price of energy. energy and food, against 3.1% in September.

But the macroeconomic signals, particularly on the front of tensions on the labor market, still weigh heavily.

On the other hand, anything that can ward off the impending or recession can momentarily give air to the index. It is in this context that the trading rooms will follow with the greatest attention the publication of the consumer confidence index (Conference Board), at 4:00 p.m. (Paris time).

“Until now, any bad statistics were welcomed by investors and were positive for the financial markets, because they made it possible to anticipate a more lenient Fed”, for Vincent Boy (IG France). “From now on, it is very likely that the bad economic data will be negative for the evolution of the global indices, due to fears of a recession in 2023.” However, the latest activity barometers (PMI in preliminary data for December) were seriously disappointing, completely missing their target.

KEY GRAPHIC ELEMENTS

The flag (November 11 / December 14) is now broken, under volume conditions that make sense. The remainder of the November 10 gap is now fully filled, without isolation of sessions; the index has two short-term “falling points” (10,260, then the symbolic threshold of 10,000 points), before considering a technical protest reaction. Price navigation is going to be very technical until the end of the year.

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 10960.00 points would revive the tension in the purchase. While a break of 10260.00 points would relaunch the selling pressure.

CHART IN DAILY DATA

©2022 News Bulletin 247

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