(News Bulletin 247) – Nervousness is palpable on the Nasdaq Composite index, the flagship index of technology stocks on the American side, which represents a whole section of the side particularly sensitive to the heating of government bond yields. Yesterday the index managed to grab 1.63% to 12,536 points, after a Friday that was not black, but bright red (-4.17%). Stealthily, the operators will approach the opening of a new Monetary Policy Committee of the Fed, which should end tomorrow with a 50 bp increase in Fed Funds. The question that remains, and which will focus the attention of forex traders at a press conference, is that of a possible “easing”, with the necessary quotation marks, of the forecast trajectory of rate hikes, following the publication of the first, unappealing estimates of US growth for the first three months of the year…
As we approach the final part of the ball of the quarterly major groups, it is clear – and it is legitimate on these levels of prices for growth stocks – that the technological files “react more strongly to disappointments than to good performance”, notes César Perez Ruiz for Pictet Wealth Management, which leads to categorize the files according to their ability to impose their price on their customers. This is the famous “pricing power”.
On the macroeconomics side, note that the week will be particularly busy on the American employment front, with a preview of the new job offers (JOLTS) this Tuesday (4:00 p.m.), the survey by the private firm ADP on Wednesday, the weekly jobless claims on Thursday and culminating in the US federal jobs report for April on Friday. Data particularly followed by the Fed in its assessment of the degree of tension in the job market.
KEY GRAPHIC ELEMENTS
The thin trading range that we identified between 13,330 and 13,838 points was broken under conditions of volumes, volatility, and very significant candles. The marubozu plotted on Thursday 04/21 shows in particular a mobilization of the selling side throughout the session, until a close almost exactly on the low points, opening the way to a bearish target CT at 12,640 points. The latter was broken, after a hesitantly nervous hesitation on the second part of last week. We specify on Friday that “the shape of the weekly candle will be important.” It is indeed very unattractive, and it is also the fourth time in four weeks that the index has closed on its weekly lows. The warnings light up.
FORECAST
Considering the key chart factors 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 is trading below the resistance at 12640.00 points.
CHART IN DAILY DATA
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