Nasdaq 100, EUR/USD rallies pause ahead of Fed decision while oil price drops
Technical analysis of the Nasdaq 100, EUR/USD as their advances pause ahead of Wednesday’s Fed rate decision while WTI is seen coming off resistance.
Macro update
Wall Street eases ahead of Fed decision:
The Dow Jones fell 0.45%, the S&P 500 slipped 0.35% and the Nasdaq 100 edged down 0.14% as traders remained cautious before Wednesday’s rate announcement.
Rate-cut expectations stay firm:
Markets continue to price an 89% probability of a 25bp cut, with investors concentrating more on guidance from a divided Federal Reserve (Fed) and the implications of the 2026 dot plot.
M&A drives notable movers:
Paramount Skydance surged on its $108.4bn hostile bid for Warner Bros. Discovery, while Confluent jumped after IBM agreed to an $11bn acquisition.
Tech outperforms as communications lags:
Microsoft, Nvidia and Broadcom supported tech gains, whereas Alphabet and Netflix weighed on the communications-services sector.
AI regulation in the spotlight:
President Trump said he will sign an executive order establishing a single national AI framework, a move seen as broadly supportive for AI-linked companies.
Asia trades cautiously:
Japan’s Nikkei 225 edged up 0.1% on chip strength, while broader regional markets remained subdued as investors awaited the Fed’s tone on future easing.
Nasdaq 100 advance pauses
The Nasdaq 100 is losing upside momentum ahead of Wednesday's Fed rate announcement for which a 25 bp cut is priced in. Further sideways trading around the 25,600 mark is expected to be seen.
A rise above Monday's 25,828 high may lead to the 26,000 area being reached whereas a fall through Monday's 25,532 low may revisit the 25,400 region.
Short-term outlook: bullish while above the 1 December low at 25,159
Medium-term outlook: bullish while above the 21 November low at 23,854
Nasdaq 100 daily candlestick chart
EUR/USD stays sidelined
Last week EUR/USD briefly hit a six-week high at $1.1682, below it has been range trading in low volatility since.
A rise and daily chart close above the $1.1682 high is needed for bullish momentum to be consolidated and for the mid-October high at $1.1728 to be in the pipeline.
Immediate upside pressure should remain in play while Monday's $1.1617 low underpins on a daily chart closing basis, together with the 55-day simple moving average (SMA) at $1.1615.
While EUR/USD remains above its late November low at $1.1556, medium-term upside pressure is expected to prevail.
Short-term outlook: bullish while above $1.1617
Medium-term outlook: neutral while below the late October high at $1.1682 but above the $1.1469 early November trough; a daily chart close above $1.1682 would change our forecast to a bullish one
EUR/USD daily candlestick chart
WTI comes off resistance
WTI has once again been rejected by the $60.00 region and is seen slipping towards its $58.28 early December low. Minor support below this level sits at the mid-November $58.12 low.
Minor resistance may now be spotted between the $59.64-to-$59.97 late October-to-early December highs.
As long as last week's $60.50 high caps, the medium-term downtrend is deemed to resume.
From a longer-term perspective a bullish reversal and rise above the $61.50 early November high is needed for the late October peak at $62.59 to be back in play. Only a rise and daily chart close above this level and the 8 October high at $62.92 would put the bulls back in control.
Short-term outlook: bearish while below the 5 December high at $60.50
Medium-term outlook: bearish while below the $62.92 early October high with another down leg towards the October low at $55.96 in the cards
WTI daily candlestick chart
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