Dow and Nasdaq futures retrace off of record highs

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Dow Technical analysis, overview, strategies, and levels

Fresh record highs for key US indices taking Wall Street across the 35K mark, though it was the underperformer as both US Tech 100 and the US 500 enjoyed larger percentage gains for the week. Monday's scare might have tested short-term technicals, but the weekly remains a stalling bull trend, in this time frame remaining out of trending territory and where any lack of upside momentum could test conformist strategies in both time frames. Visa Inc (All Sessions) and Home Depot Inc (All Sessions) were relative outperformers amongst its components, Intel Corporation on the other end suffering heavily - beat on revenue and earnings, warned of ongoing shortages and a lower guidance on margins for Q3. It's about earnings this week with components releasing their figures tomorrow through the end of the week, economic data relatively light tonight with new home sales.

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IG client* and CoT** sentiment for the Dow

In sentiment, CoT is back in slight sell territory (longs down by 4,413 lots, shorts up by 2,152 lots), while retail is extreme short 78%.

Dow chart with retail and institutional sentiment

Nasdaq technical analysis, overview, strategies, and levels

Fresh record highs for the US Tech 100 that took it above the 15K mark in a session of outperformance for communication, and where tech offered decent gains. Component performance put Moderna Inc on top - European health officials recommending its coronavirus vaccine use for 12+, and Meta Platforms Inc (All Sessions) in second with upbeat results for social media firms such as Twitter Inc (All Sessions) and Snap Inc (All Sessions) ahead of its figures later this week.

And while the losses in the red were small for most, Chinese shares took a heavy hit with NetEase Inc in the very bottom, with JD.com Inc (All Sessions) and Baidu Inc Hong Kong Listing also suffering. More pain could also be in store for them following weekend Chinese tech news. As for earnings amongst its components, the big one for today is Tesla Inc with the numbers for Cadence Capital Ltd and Check Point Software Technologies Ltd also expected to be released. And the names will get bigger with the rest of the FAANG+TM stocks over the next few days.

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IG client* and CoT** sentiment for Nasdaq

CoT sentiment is slight sell but has dropped to 51%, retail bias heavy short.

Nasdaq chart with retail and institutional sentiment

DAX technical analysis, overview, strategies, and levels

Similar to the FTSE 100, the short-term daily technical overview is 'consolidation - volatile', where the moves have aided conformist breakout strategies intraday on most days even if price have moved back towards an average interday.

Zooming out to the weekly and it’s a bull trend stalling heavily at these levels, a negative DMI cross occurring in this time frame. Friday's finish in the green had plenty of components outperforming and where there were big gains for Mercedes-Benz Group AG and CUO-US, only a few in the red with Vonovia SE and Siemens Energy suffering most. German preliminary PMIs showed both manufacturing and services beat estimates, and we'll get ifo's readings on business climate, current assessment, and expectations shortly.

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IG client* sentiment for the DAX

Retail bias was a slight sell 54% at the start of last week, and briefly shifted to majority long following Monday's plummet, but the recovery has taken it to heavy sell territory to start this week off at 69%. While we don't get CoT figures for this index, they are heavy sell Russell, slight sell in the Dow after shifting from slight buy, near the middle in the tech-heavy Nasdaq, and slight buy for the S&P 500.

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.}