Dow, Nasdaq, and DAX gap lower this morning in risk-off play
Indices in retreat while energy and safe haven outperform this morning following weekend oil attacks.
DOW: Back near record highs and resting at its mid-term resistance level but dented by today’s risk-off event
Equities are back near the highs despite gapping lower this morning, and for the Dow not that far off from its record high recorded a couple months ago. From a technical standpoint on the weekly, we’re back at a bull trend overview but where its price is close to its mid-term resistance level. Apple lagged on Friday, while the surge in oil prices are expected to aid energy stocks as US shale producers get a lifeline at a time when the industry continues to suffer bankruptcies despite an increased domestic oil pipeline network. This week its going to be about the Federal Reserve and whether it’ll reduce rates as markets are majority pricing in or if it decides to keep them on hold following what has been relatively mixed-to-the-upside US data. Retail shorts have been getting squeezed and taking heavy short bias down 5%, while institutional bias has dropped 4% but remains in extreme long territories at 86%.
NASDAQ: Finishing higher for the week but only just
Unlike the Dow which has been outperforming as of late and homing in on its record highs posted two months ago, for the Nasdaq it only just finished higher for the week, with ongoing news of trouble for the tech giants. But the gains have meant its technical bias is show more positivity despite gapping lower this morning on a risk-off event, and whereby most of its weekly indicators are still flashing green and combined with a trending ADX. The lack of upside momentum has prevented retail short bias from rising significantly, and as a result stands at a majority short 66% as of the start of this week. Institutional bias is a near opposite majority long 61%, up a notch on a slight increase in long positions and a simultaneous small decrease in shorts.
DAX: Finishing higher for the week following the ECB’s easing program announcement
Thursday’s volatility aside, investors had been increasing their positions in the DAXeven prior to the ECB’s announcement in anticipation that it would begin buying up bonds and force more money into riskier assets as the hunt for yield on the continent remains tough. From a technical standpoint – and its been fundamental forces causing the recent moves – the weekly overview is bullish whereby its price stands at its mid-term resistance level, while on the daily overview all its technicals are flashing green. Retail bias is up 10% to a heavy short 76% as longs continue to get enticed into taking profit and short continue to average-in, and helped in the process but today’s morning gap lower on the weekend oil attacks that have reduced risk appetite.
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