Fresh record high for the Nasdaq, Dow and DAX finish up
Retail and CoT shorts hurt in the Dow, range-trading in the DAX slows.
Dow Technical analysis, overview, strategies, and levels
What started yesterday with a strong session out of China ended in a higher finish in the US with the Dow crossing and closing above the last of its main daily long-term moving averages (MA), the 200-day MA. With the exception of Walmart, all its components avoided losses with the gains largest for Goldman Sachs, Boeing, and Walgreens ahead of its earnings later this week. Defensive utilities aside, all US sectors finished higher and where consumer discretionary and communications outperformed. ISM's non-manufacturing PMI (Purchasing Managers Index) reading beat expectations by a healthy margin.
IG client* and CoT sentiment for Dow
The latest moves however haven't been in favor of traders who are holding a majority short bias, with retail sell bias up at 59% and CoT (Commitment of Traders) speculators short bias reduced but still in heavy sell territory at 74% following a reduction in shorts by 1,321 lots and an increase in longs by 89 lots.
Dow chart with retail and institutional sentiment
Nasdaq Technical analysis, overview, strategies, and levels
A stellar session for the tech-heavy Nasdaq, already taking its price nearly towards its Weekly 1st Resistance level as its bull trend technical overview remains intact, and where it has now breached the upper end of its bull trend channel. Nearly all its components outperformed, but it was Tesla that took the attention with double-digit percentage gains that took its share price above $1,400 in after-hours trading. Xilinx and Amazon were also outperformers, the latter's share price breaching the $3,000 level. The handful of its components that finished lower included Dollar Tree and Amgen.
IG client* and CoT sentiment for Nasdaq
Retail short bias is squeezed on the latest moves with the heavy sell sentiment dropping a notch to 72%. On the CoT side, they remain long Nasdaq and with an increase in consolidated longs by 774 lots and a drop in shorts by 196 lots, that bias is up a notch to a heavy long 69%.
Nasdaq chart with retail and institutional sentiment
DAX Technical analysis, overview, strategies, and levels
Here too, the DAX couldn't avoid the gains in equities on risk appetite that was sparked with a significant move out of China yesterday. Its price is making its way towards a short-term resistance level, and where most of its main indicators are flashing green after stalling heavily within the roughly 12,000-12,500 levels. Wirecards's volatility and double-digit percentage plummet and Beiersdorf's finish lower aside, all its components finished higher, the gains highest for Deutsche Bank, Infineon, and Daimler. Yesterday's German factory orders registered an increase though was below expectations, and we'll get industrial production shortly.
IG client* and CoT sentiment for DAX
Lastly, in sentiment, retail bias is still heavy short but instead of increasing as is usually the case of range-trading moves, the bias has dropped a notch to 66% instead.
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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