Dow, Nasdaq and DAX stall not far off the highs

Dow technical analysis, overview, strategies, and levels

Still within a rough short-term daily bull trend channel, the technical boxes remain mostly neutral in this time frame even as the price of Wall Street approaches closer to fresh highs that's sure to take some attention, the weekly showing far more positive technical bias. Most of its components were in the red yesterday, losses heavy for Merck and Caterpillar, the handful or so in the green including Microsoft (Morgan Stanley analyst note) and Boeing.

What little on offer in the economic calendar out of the US showed consumer credit fail to improve with its previous revised lower, and later today we get trade with expectations for a sizable but improved deficit, and job openings remaining above 8m.

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IG client* and CoT** sentiment for the Dow

Traders getting more comfortable at these levels means range-trading is getting heavier, the heavy sell 66% bias at the start of the week dropping to a slight sell 53% on yesterday's relatively small pullback, and where it could easily shift to majority long on another price drop.

Dow chart with retail and institutional sentiment

Nasdaq technical analysis, overview, strategies, and levels

Unlike the Dow that lagged, it was a green finish for the US Tech 100, the tech sector relatively unchanged but where communication came in second-best. While there were plenty of components in the red like Fiserv (a downgrade to hold from buy), Verisk, and Broadcom (still relatively lagging in the semiconductor sphere), key components like Facebook and Microsoft finished higher, and where it was a big boost for Biogen with 38%+ gains after the FDA approved its Alzheimer's drug with a $56K annual price tag for its treatment that was well above $10-25K expectations.

From a technical standpoint for the tech-heavy index, both time frames have seen struggles in getting prices back towards the highs, the volatile moves late last week a break from consolidatory moves prior, and where (as always) traders will be noting yields.

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IG client* and CoT** sentiment for Nasdaq

In sentiment, retail bias has shifted to slight long despite the price gains, and is at 52% as of this morning.

Nasdaq chart with retail and institutional sentiment

DAX technical analysis, overview, strategies, and levels

Lack of a play for the Germany 40 even if higher highs were met, though given how relatively sedate it has been for its price and should there be a volatile move would result in a break of key levels, its price at the upper end of the bands and short-term bull trend channel. Continental, BMW and MTU Aero Engines were components enjoying relative outperformance, the dozen or so in the red led by Linde and Siemens. German economic data showed factory orders contract in what was a miss, its previous revised higher though to a stronger 3.9% reading.

We'll get industrial production shortly with hopes it'll remain positive after its previous 2.5% growth, and ZEW sentiment figures later today expected to improve.

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IG client* sentiment for the DAX

As for sentiment, while it's still a clear majority sell amongst retail traders, it has slipped out of extreme short territory to 76% as of this morning.

DAX chart with retail 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 for the outer circle. Inner circle is from the previous trading day.

**CoT sentiment taken from the CFTC’s Commitment of Traders report, outer circle is latest report released on Friday with the positions as of last Tuesday, inner circle from the report prior.