Dow, Nasdaq and DAX finish the week slightly off the highs

Sign up for IG's Daily and Weekly Market Report to receive this information and more, in an elaborate and comprehensive report recounting the forex majors, commodities and indices before the European open.

Dow technical analysis, overview, strategies, and levels

Oscillatory moves that failed to reach weekly levels, and also failed to offer follow-through beyond the breach of its previous daily first resistance level as it continues to stall near the highs and testing conformist breakout strategies, a struggling bull trend where the ADX in this time frame no longer shows a propensity to trend.

Component performance on Friday put Procter & Gamble Co (All Sessions) on top following its earnings and forecast for higher core earnings this year, most in the red with Caterpillar Inc (All Sessions) in the very bottom after its warning that profits will suffer on rising costs. Plenty of US data late last week, which showed the advanced estimate of US GDP disappoint with a strong 6.5% as opposed to 8.5% expectations, the closely watched core PCE price index rising a notch to 3.5% year-on-year but below estimates and its monthly figures below its previous with a 0.4% reading, an increase in spending though partly due to higher prices, personal income grow slightly, income surprisingly positive, and pending home sales contracting.

Want to trade Wall Street?

Create an IG trading account or log in to your existing account to get started now.

IG client* and CoT** sentiment for the Dow

When it comes to CoT speculators, they've shifted to the middle from a slight sell 52% following an increase in longs by 1,357 lots and shorts dropping by 416 lots. As for retail traders, the consolidatory moves near the highs has given a chance for some to average their way out, extreme sell 78% last Monday now 70%.

Dow chart with retail and institutional sentiment

Nasdaq technical analysis, overview, strategies, and levels

Big Tech was in focus for much of last week and although there were plenty of earnings beat, Amazon.com Inc (All Sessions)'s revenue miss and warnings on future sales growth in the next few quarters put it at the bottom in terms of component performance, and dragging component eBay Inc (All Sessions), and non-components like Etsy Inc, with it.

While most were in the red in Friday's session, Atlassian Corp PLC surged following its earnings beat by a healthy margin, DexCom Inc also enjoying double-digit percentage gains on its figures. In component earnings, NXP Semiconductor NV is expected next. In terms of levels, this index's weekly first support level held following last Monday's plummet, while on the daily its previous first support level was in for a tough break that went beyond its S/L level before reversing in another test of its current stalling bull trend technical overview.

Want to trade the US Tech 100?

Create an IG trading account or log in to your existing account to get started now.

IG client* and CoT** sentiment for Nasdaq

As for sentiment, CoT speculators reduced long positions by more than shorts, taking slight sell bias to 54%.

Nasdaq chart with retail and institutional sentiment

DAX technical analysis, overview, strategies, and levels

Oscillatory moves for the DAX with a slight downside finish, and with prices were just shy of its previous weekly first support level and just within its previous daily levels late last week meant it failed to offer a play in both time frames, short-term levels widening a bit making a breakout move potentially less fruitful unless volatility picks up significantly.

There weren't a lot of components outperforming on Friday, Linde PLC and Delivery Hero SE on top while the other end showed significant losses for Fresenius SE & Co KGaA, Deutsche Post AG also underperforming. German data late last week showed its unemployment rate drop to 5.7% while year-on-year CPI jumped to 3.8%, its core also above estimates at 0.9% for the month of July.

Preliminary GDP was a miss though shifted to growth for the second quarter. We'll get retail and final manufacturing PMI today.

Want to trade the Germany 30?

Create an IG trading account or log in to your existing account to get started now.

IG client* sentiment for the DAX

As for sentiment, the slightest of pullbacks means retail shorts can unwind, heavy sell 69% dropping to 62%. We don't get CoT figures for this index, but for US indices they are in the middle for the Wall Street, slight buy US 500 slight sell US Tech 100, and heavy short Russell.

DAX chart with retail sentiment

^{*The percentage of IG client accounts with positions in this market that are currently long or short. Calculated to the nearest 1%, as of today morning 8am for the outer circle. Inner circle is from the previous trading day.}

^{**CoT sentiment taken from the CFTC’s Commitment of Traders report, outer circle is latest report released on Friday with the positions as of last Tuesday, inner circle from the report prior.}