Dow and Nasdaq mostly consolidatory as focus shifts to trade talks
Sentiment shifts in the DAX to majority short on heavy range-trading.
DOW: Consolidatory event befitting its current overview, but still at risk of volatility on any fresh trade news
Having crossed beneath most of its main long-term moving averages on Tuesday, the US Federal Reserve's (Fed) minutes caused equities to experience relatively range-bound movement, and with investor focus set to shift to US-China trade talks that show little signs of a breakthrough, and unconfirmed news that the US is looking to make a currency pact with China. Tech shares' Microsoft, Intel, and Apple were among the outperformers. As for sentiment, retail traders have increased their short bias on the upside movement, now standing at a majority short 60%.
NASDAQ: Briefly crossing above its main long-term moving averages but failing to close above it
Both Dow and Nasdaq experienced consolidatory movement and finished higher, though in this case the tech index’s price crossed both its 50-day and 100-day moving averages but failed to close above it, and enticed more shorts into entering with retail majority short bias standing at 63% and near exact opposite Commitment of Traders (CoT) speculative bias. Most of its components finished in the green, but Netflix underperformed as increased streaming competition is set to go online.
DAX: Retail bias shifts back to majority short as range-trading shorts enter
US-China trade talks will indirectly affect the German index, not just due to its export-oriented sector that'll be in need of more dollars in the international trade system and a stronger yuan for higher purchasing power out of China, but also the effect it might have on future US-EU trade talks as the trade war spreads to engulf the bloc. The index’s price crossed back and finished above 50-day moving average (MA) but couldn’t finish above its 200-day MA. Range-trading remains the heaviest here amongst retail traders, and the move higher has increased retail bias by 8% to shift it to a majority short 58% as opposed to being in the middle yesterday.
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