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.
S&P 500
Technical Analysis – Daily Timeframe
On
the daily chart, we can see that
the S&P 500 bounced from the key swing point around the
6,541 level. The buyers stepped in there with a defined risk below the lows to
position for a rally back into the all-time highs. The sellers, on the other
hand, will want to see the price breaking lower to increase the bearish bets
into the 6,372 level next.
S&P 500 Technical
Analysis – 4 hour Timeframe
On
the 4 hour chart, we can see that
we have a downward trendline defining the bearish momentum. If we get a
pullback into the trendline, we can expect the sellers to lean on it 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 the
next trendline around the 6,840 level.
S&P 500 Technical
Analysis – 1 hour Timeframe
On the 1 hour chart, we can
see that we have a minor support zone around the 6,600 level. If the price gets
there, we can expect the buyers to step in with a defined risk below the
support to position for a rally into the trendline. The sellers, on the other
hand, will look for a break lower to pile in for a drop into new lows. 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.
This article was written by Giuseppe Dellamotta at investinglive.com.