Risk-off mood takes Dow, Nasdaq and DAX lower
Retail short bias drops in Dow as fresh shorts take profit.
Dow Technical analysis, overview, strategies, and levels
With investors spooked, the Dow started off the week with a drop in its price past its Weekly 1st Support level, and already testing its bull trend technical overview as its price hovers near the lower end of its daily bull trend channel. Amongst its components, while IBM finished higher, it has dropped in after hours, withdrawing its 2020 annual forecast as its clients opted to move towards savings, even if it will continue to pay dividends. Cisco aside, the rest finished in the red lead by Boeing and where energy giants' Chevron and ExxonMobil weren't that far off suffering big declines. Defensive utilities and real estate, as well as the obvious energy were deeply in the red, with health care dropping the least. In politics, the US Speaker has said that both sides have generally agreed in principle for the next coronavirus relief package, saying she was optimistic it would be finalized shortly.
IG client* and CoT sentiment for Dow
Dow chart with retail and institutional sentiment
Nasdaq Technical analysis, overview, strategies, and levels
Less so than the Dow which has an energy component, the Nasdaq finished lower for the session. Amongst its components, pharmaceuticals were relative outperformers, with Netflix amongst them ahead of its earnings which will be a closely watched event. Losses at the bottom included Marriott and Expedia, as the travel sector fails to see light at the end of the tunnel thus far. From a technical standpoint the overview here is more bullish, but the gain in equities generally have been against fundamentals even if some states ease lockdown restrictions.
IG client* and CoT sentiment for Nasdaq
In sentiment, retail bias here hasn't dropped but risen instead to 64%, unlike in the Dow where the price plummet has enticed shorts into profit-taking.
Nasdaq chart with retail and institutional sentiment
DAX Technical analysis, overview, strategies, and levels
It was only a slight finish lower for the German DAX yesterday, its price staying above its weekly (and similar) daily 1st Resistance levels and keeping its bull trend channel on the daily chart tested and barely intact as its main technical indicators show conflicting results, with its price making a move towards its 50-day moving average and above all its main short-term moving averages, a positive DMI (Directional Movement Index), and a non-trending ADX (Average Directional Index). In earnings, SAP will be releasing its figures today.
IG client* and CoT sentiment for DAX
Last, in sentiment, retail bias while still majority short has dropped from a heavy short 66% yesterday to 63% as of this morning.
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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