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CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Fresh record highs for Dow and Nasdaq, DAX surges

US indices post fresh record highs buoyed by energy, short positions continue to get squeezed.

Charts Source: Bloomberg

Dow Technical analysis, overview, strategies, and levels

Another day, another fresh high for indices, and where in the case of the Dow a fresh record high breaching its infamous mid-term resistance level and putting the squeeze on short traders. In terms of sectors, the outperforms were energy by a clear margin with both Chevron and Exxon outperforming, while defensive stocks were on the defensive as both utilities and real estate were in the red. While further gains can’t be ruled out, the catalyst for these gains means they’ll easily be at risk of an eventual reversal, testing short traders in the process.

Current Technical Overview Bull Trend
Technical Overview Conformist Strategies Buy 1st Support After Reversal, Buy 1st Resistance Upon Breakout From Below
Technical Overview Contrarian Strategies Sell 1st Resistance At/Before Price, Sell 1st Support Upon Breakout From Above
S/L for 2nd Resistance 27902
2nd Resistance 27811
S/L for 1st Resistance 27719
1st Resistance 27628
Relative Starting Point 27445
1st Support 27262
S/L for 1st Support 27171
2nd Support 27079
S/L for 2nd Support 26988

IG client and CoT sentiment for Dow

In sentiment, yesterday’s retail trader extreme short bias has dropped but remains in heavy short territories, opposite institutional bias standing at an extreme long 83%.

Dow sentiment Source: IG charts
Dow sentiment Source: IG charts

Dow chart with retail and institutional sentiment

Dow Source: IG charts
Dow Source: IG charts

Nasdaq Technical analysis, overview, strategies, and levels

A pop higher in this index's price to post a fresh record high in what has been a common theme for the tech index, and ensuring in keeping the bulk of its main technical indicators bullish and its Average Directional Index (ADX) showing a propensity to trend.

Current Technical Overview Bull Trend
Technical Overview Conformist Strategies Buy 1st Support After Reversal, Buy 1st Resistance Upon Breakout From Below
Technical Overview Contrarian Strategies Sell 1st Resistance At/Before Price, Sell 1st Support Upon Breakout From Above
S/L for 2nd Resistance 8413
2nd Resistance 8378
S/L for 1st Resistance 8344
1st Resistance 8309
Relative Starting Point 8240
1st Support 8170
S/L for 1st Support 8136
2nd Support 8101
S/L for 2nd Support 8066

IG client and CoT sentiment for Nasdaq

However, for IG's client sentiment figures and as with the Dow, extreme short bias amongst retail traders has dropped but remains in heavy short levels.

Nasdaq sentiment Source: IG charts
Nasdaq sentiment Source: IG charts

Nasdaq chart with retail and institutional sentiment

Nasdaq Source: IG charts
Nasdaq Source: IG charts

Dax Technical analysis, overview, strategies, and levels

It already reached the upper end of its weekly resistance level – and breached it – in a sign of a flurry of activity for the German DAX that is pushing the index to fresh highs and keeping its bull trend technical overview intact. However, as we pointed out yesterday, both daily and weekly movement remains relatively rangebound, and hence intraday strategies for limited profit-taking have been more ideal, even if in favor of its current bull trend technical overview. While the overview is a bull trend, it could easily stall again as has been the case on the weekly.

Current Technical Overview Bull Trend - Stalling
Technical Overview Conformist Strategies Buy 1st Support After Reversal, Buy 1st Resistance Upon Breakout From Below
Technical Overview Contrarian Strategies Sell 1st Resistance At/Before Price, Sell 1st Support Upon Breakout From Above
S/L for 2nd Resistance 13403
2nd Resistance 13355
S/L for 1st Resistance 13307
1st Resistance 13260
Relative Starting Point 13164
1st Support 13069
S/L for 1st Support 13021
2nd Support 12974
S/L for 2nd Support 12926

IG client and CoT sentiment for DAX

But unlike both Dow and Nasdaq, retail bias here hasn’t budged, remaining at an extreme short 81% and getting squeezed by the recent price gains.

DAX sentiment Source: IG charts
DAX sentiment Source: IG charts

DAX chart with retail and institutional sentiment

DAX Source: IG charts
DAX Source: IG charts
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This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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