Fresh record high again for Nasdaq, Dow and DAX gap higher
CoT bias remains mixed holding a majority long bias in the tech-heavy Nasdaq, while majority short Dow.
Dow Technical analysis, overview, strategies, and levels
Financial stocks outperformed on Friday ahead of earnings releases this week, with the sector taking in the most gains followed by energy. That meant amongst the Dow's components JPMorgan and Goldman were on top with energy giants' ExxonMobil and Chevron not that far off. And while the index finished the week higher crossing and closing above its 100-week moving average this time around, its price stayed within its key Weekly pivot points, and on the Daily offering conformist buy-on-reversal opportunities on Thursday on a recovery off of its 1st Support level. US data is low-impacting today with the first of plenty of Fed speakers this week, but expect attention to remain on earnings overall even if the company issuing isn't one of its components.
IG client* and CoT sentiment for Dow
In sentiment, a 674 lot increase in longs and an unwinding of shorts by 1,319 lots has taken CoT (Commitment of Traders) speculator short bias lower to 71%. Retail bias is also majority short, rising to 61%.
Dow chart with retail and institutional sentiment
Nasdaq Technical analysis, overview, strategies, and levels
Another week with a record high for the tech-heavy Nasdaq, but once again testing conformist breakout strategies either by testing the level multiple times as it did with last week's Weekly 1st Resistance level before eventually breaking, or on Daily levels with a lack of intraday follow through. Amongst its components on Friday, Tesla outperformed with its share price reaching another fresh record high breaching the $1,500 level, with big gains and fresh all-time highs for Netflix ahead of its earnings release later this week. But there were underperformers, including Synopsys, Regeneron Pharmaceuticals, and Incyte.
IG client* and CoT sentiment for Nasdaq
The latest CoT report showed an increase in both long and short positioning by 703 and 527 lots respectively, the net result an unchanged ongoing heavy long bias amongst larger speculators. That stands in near exact contrast with retail traders whose heavy short bias of 73% is unchanged since the start of last week.
Nasdaq chart with retail and institutional sentiment
DAX Technical analysis, overview, strategies, and levels
For the DAX, neither of its Weekly pivot points were reached as it ended relatively little changed from where it started, and so too was the case for its Daily pivot points towards the end of the week as its price oscillated within narrow ranges. Most of its components finished higher on Friday with the gains led by Heidelberg and MTU, and where most volatile Wirecard was in the bottom suffering the biggest percentage losses. German data was mixed last week with worse than expected growth for factory orders and industrial production but a larger than expected trade surplus. We get final CPI (Consumer Price Index) and ZEW sentiment figures tomorrow before attention shifts to central bank decisions and the EU's fiscal policy at the end of the week.
IG client* and CoT sentiment for DAX
In sentiment, the percentage changes are getting larger on smaller price moves suggesting an increase once again of range-trading these levels, rising from 60% on Thursday to 71% at the start of this week.
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.
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