Nasdaq Composite: Relief after consumer price indices

(News Bulletin 247) – Statistical highlight of this Wednesday, the consumer price indices in the United States, which have just been published a few minutes ago, showed a greater than expected rise in the inflation. Although the Fed prefers PCE prices as a barometer (Personal Consumption Expenditures), the signal is sensitive. Excluding food and energy (elements considered volatile), prices rose in December by 0.6%, against a target of +0.5%. Not enough to disturb the trading rooms, however: government bond yields continued their downward movement, towards 1.725. Movement initiated yesterday with the intervention of firefighter Powell. It must be said that the rate of monthly rise in prices confirms its tendency to slow down. Remember that in May and July, on the same basket of products, the monthly increase was 0.8%.

Asked by the Senate on Tuesday about the institution’s strategy to fight inflation in the United States, J Powell “promised to do everything possible” during his second term to fight against rising consumer prices. , while the CPI index rose at a rate not seen in nearly 40 years in November, at +6.8% year on year, according to figures from the Bureau of Labor Statistics – a far cry from the 2% target considered as healthy by the Fed for the economy, but slightly below analysts’ expectations, which were betting on a 7% increase on an annual basis.

“The Fed was patient in the face of the inflationary surge due to the supply shock, thinking that it was doomed to fade,” remarks Vincent Manuel, Chief Investment Officer at Indosuez Wealth Management. “However, recent indicators suggest that price pressure would continue even if supply recovers, due to robust demand. As previously reported, the latest labor market and inflation data have prompted the Fed to accelerate the reduction of its asset purchases, which should end between February and mid-March 2022.

On the value side, Apple (+1.68% to $175.08), Meta Platforms (+1.92% to $334.37) and Amazon (+2.40% to $3,307.24), among other giants tech, particularly sensitive to the barometer of 10-year Treasuries, outperformed the market yesterday.

KEY GRAPHIC ELEMENTS

Regarding the substantive technical framework, unchanged at this stage:

Since October 28 and the registration of new historic highs after those of September 07, the flagship index of technology stocks on the American quotation has systematically closed on the high points of the session, in fed volumes, which contract only very little. . The buyer camp, fully mobilized, does not ask questions. An oblique straight line (drawn in black) perfectly symbolizes the basic appetite of buyers, as well as their mobilization over time.

A court terme:

On the other hand, the picture is much more nuanced in the short term since the bearish engulfing of November 22, after registrations of historic highs. Yesterday in solid volumes, the index came to close on the low points exactly, after continuous losses during the session, leaving as a trace a candle in marubozu of school. The flagship index of US listed technology stocks came to test a steep bullish slant (in black), which we are placing under close watch. Its break, in progress, must still be validated by volatility and volumes.

PREVISION

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 15900.00 points would revive the tension in the purchase. While a break of 14740.00 points would relaunch the selling pressure.

CHART IN DAILY DATA

©2022 News Bulletin 247