NASDAQ Composite (.IXIC) Eyes Record High
Dow Jones futures rose slightly Thursday night, ahead of Friday’s jobs report. S&P 500 futures and Nasdaq futures also were higher after U.S. stock markets were closed for Independence Day. The stock market rally powered ahead Wednesday, with the Dow Jones and S&P 500 index setting all-time highs and the Nasdaq composite nearly there. Apple stock is approaching a buy point. So are FANG internet giants Facebook stock, Amazon stock, Netflix stock, while Google stock is trying to bounce back.
On a technical basis, investors want to see the stock market rally convincingly clear old highs. But it’s still a news-driven market rally.
Renewed China trade talks and expectations of multiple Fed rate cuts have recharged the stock market rally from a June 3 low. It’s still unclear if China trade talks will lead to a comprehensive deal. If not, then the China trade war could escalate again in a few months.
Meanwhile, Friday’s jobs report will go a long way toward figuring out if a July 31 Fed rate cut will be a quarter point or 50 basis points. Next week’s testimony by Fed chief Jerome Powell and minutes from the June policy meeting also will be key.
Wall Street estimates the U.S. added 152,000 jobs, with the jobless rate holding at 3.6% and hourly wages picking up to a 3.2% gain.
Markets expect a Fed rate cut on July 31, with a 30% chance that it’ll be 50 basis points. There’s a 75% chance that policymakers will cut Fed rates by a total of 50 basis points by the September meeting.
Dow Jones futures traded normally on the Fourth of July even as U.S. stock markets were closed. Overseas exchanges were open. Asian markets were narrowly mixed Thursday. European markets were little changed.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 7,835.65.
The projected upper bound is: 8,419.68.
The projected lower bound is: 7,922.76.
The projected closing price is: 8,171.22.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 25 white candles and 25 black candles.
A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 6 rising windows in the last 50 candles–this makes the current rising window even more bullish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 86.6425. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 7 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 67.16. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 21 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 146.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 6 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 18 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed up 61.139 at 8,170.231. Volume was 29% below average (neutral) and Bollinger Bands were 9% wider than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 8,022.79 7,864.20 7,514.44
Volatility: 14 20 26
Volume: 710,790,080 578,250,560 599,933,504
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
NASDAQ COMPOSITE gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
NASDAQ COMPOSITE is currently 8.7% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into .IXIC (mildly bullish). Our trend forecasting oscillators are currently bullish on .IXIC and have had this outlook for the last 12 periods.