Fresh highs for indices, CoT bias remains mixed
Dow and Nasdaq breach new levels, little on offer today out of the economic calendar amidst US and Chinese holidays.
Dow Technical analysis, overview, strategies, and levels
Oscillatory movement near the highs have meant there's been little strategic play off of its previous key levels, just shy of its 1st Support level last Thursday. And given that its price has stayed near the highs, the technicals (more so on the Weekly than Daily) continue to flash green and combined with a trending ADX, but where traders remain wary of a sudden volatile pullback similar to what was witnessed earlier this month. Financials relatively outperformed on Friday by the close with JPMorganJPMorgan and Goldman relative outperformers, Intel on top, while Disney led the losses amongst the dozen components finishing in the red. US data was a miss for both unemployment claims and preliminary consumer sentiment out of UoM, mortgage delinquencies dropping but still above pre-pandemic levels.
IG client* and CoT** sentiment for Dow
In sentiment, CoT speculators increased longs by 824 lots with shorts dropping 118 lots, the slight sell bias moving closer to the middle at 53%.
Dow chart with retail and institutional sentiment
Nasdaq Technical analysis, overview, strategies, and levels
As with the Dow, although it was a finish higher for the Nasdaq that has kept its key technical indicators mostly flashing green on both the Weekly and Daily, there was less to cheer about from a strategic standpoint on a lack of a move towards its key levels on both time frames. Component performance showed Illumina (Q4 earnings beat, improved Q1 outlook) , PayPal, and Applied Materials on top, while Ross Stores and Nvidia (unconfirmed reports on Qualcomm and other tech giant objection to its Arm acquisition) relatively underperformed.
IG client* and CoT** sentiment for Nasdaq
As for sentiment, there's also been movement towards the middle for CoT speculators with both long and short positioning dropping, still opting to hold a majority long bias. Retail traders start off the week in heavy sell territory shorting recent price gains, with more longs tempting into closing out (not the case for shares, as they hold extreme long bias in most of the major tech stocks with above 90% buy bias).
Nasdaq chart with retail and institutional sentiment
DAX Technical analysis, overview, strategies, and levels
There's been a general lack of volatility when it comes to indices, the DAX no exception staying within its previous Weekly levels and failing to offer a play, the Daily also experiencing less volatility on most days and in turn resulting in a narrowing of levels should oscillatory movement persist. But given its price is near the highs it's also kept its key technical indicators flashing green. Fresenius, Deutsche Bank, and Siemens were the components relatively outperforming on Friday, losses heaviest for VW and Continental. There was little German data to go on, WPI (Wholesale Price Index) on Thursday showing an increase that was stronger than expected. Tomorrow's focus will be on ZEW economic sentiment figures.
IG client*sentiment for DAX
The pullback off the highs intraweek resulted in fresh short unwinding, retail sell bias out of extreme short territory and starting this week at 72%. CoT bias for US indices are slight sell Dow, S&P, and Russell, while majority long Nasdaq.
DAX chart with retail and institutional 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.
Be sure to request IG’s Weekly & Daily Market Report when you open an account with IG Dubai and get access to the full information on the FX majors, commodities, indices, and Bitcoin.
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
Seize your opportunity
Deal on the world’s stock indices today.
- Trade on rising or falling markets
- Get one-point spreads on the FTSE 100
- Unrivalled 24-hour pricing
See opportunity on an index?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on an index?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from one point on the FTSE 100
- Trade more 24-hour indices than any other provider
- Analyse and deal seamlessly on smart, fast charts
See opportunity on an index?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets