Fundamental Overview
The uncertainty about a December cut has been weighing on the stock market ever since Powell delivered his infamous line saying that a December cut was not a foregone conclusion. The lack of official US data and cautious stance from Fed members didn’t help either.
On Friday though, Fed’s Williams suggested that he would support a rate cut in December and the market pricing jumped immediately to 60%, giving the stock market a boost. As things stand, a rate cut in December is now more likely and that should support the stock market heading into the meeting.
Moreover, we got also the news that Trump administration was considering selling the H200 Nvidia chips to China, which was another positive catalyst for the market.
This week, we have a holiday-shortened week due to Thanksgiving on Thursday, but we will still get two important economic data like the weekly ADP report tomorrow and the most recent US Jobless Claims on Wednesday.
Nasdaq Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq probed below the October low but couldn’t sustain the breakout and bounced back following the dovish comments from Fed’s Williams and later the Nvidia news. The buyers stepped in to position for a rally into the all-time highs, while the sellers will want to see the price falling back below the October low to extend the correction into the 23,030 level next.
Nasdaq Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that we have a downward trendline defining the bearish momentum. That should be the first target for the buyers. If we get there, we can expect the sellers to lean on the trendline with a defined risk above it to position for a drop into new lows. The buyers, on the other hand, will look for a break higher to increase the bullish bets into new highs.
Nasdaq Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we some consolidation here. We have a minor support zone around the 24,300 level. This is where we can expect the buyers to step in with a defined risk below the support to keep pushing into the trendline. Alternatively, the buyers could wait for a break above the recent high at 24,600 to pile in for a rally into the trendline.
The sellers, on the other hand, will look for a break below the support and October low to increase the bearish bets into the 23,030 level next. The red lines define the average daily range for today.
Upcoming Catalysts
Tomorrow we get the weekly ADP jobs data and the US Consumer Confidence report. We will also get the September US PPI and Retail Sales reports. On Wednesday, we get the most recent US Jobless Claims figures and the September Durable Goods Orders report. On Thursday, we have the US Thanksgiving holiday, so the final part of the week will likely see a rangebound market.
