Dow, Nasdaq and DAX enjoyed a slightly higher finish ahead of expected trade decision
US indices finish slightly higher following Fed decision, but trade decision expected ahead of December 15 tariffs, and DAX set to get affected by the ECB.
Dow Technical analysis, overview, strategies, and levels
With the US Federal Reserve (Fed) opting to keep rates on hold and signaling it may remain that way for 2020, indices like the Dow finished slightly higher for the session. In terms of sectors, information technology and materials outperformed, while real estate was heaviest in the red. Amongst its components, Chevron and Home Depot were at the bottom, the former taking a $10bn write-down tied to natural gas in Appalachia. With the Fed announcement out of the way, the next key risk item is UK parliamentary elections in the context of Brexit, as well as any fresh trade news where reports indicate a meeting is expected in the US today to discuss the December 15 planned tariffs.
IG client and CoT sentiment for Dow
Retail bias has risen 3% since yesterday to a heavy short 65%, and should equities’ price movement remain relatively rangebound and it’ll entice more traders into range-trading over trend trading.
Dow chart with retail and institutional sentiment
Nasdaq Technical analysis, overview, strategies, and levels
With equities finishing slightly higher yesterday, the Nasdaq was no exception to that rule, but avoided the upper pivot points on a relative lack of momentum within risk. That momentum may likely be changing today depending on fundamental risk-related items like trade. In earnings, Adobe, Costco and Broadcom will be announcing their figures today.
IG client and CoT sentiment for Nasdaq
As for sentiment, there’s been no change amongst retail traders for the tech index, standing at a heavy short 74%.
Nasdaq chart with retail and institutional sentiment
DAX Technical analysis, overview, strategies, and levels
The DAX has managed to recover off the brief low towards its 50-day moving average that occurred on Tuesday. And while it (alongside other indices) enjoyed a higher finish following yesterday’s Fed announcement, the focus now shifts to today’s ECB (European Central Bank) monetary policy announcement which will mean more for this German index, especially in the context of the current bond purchasing program in place that is indirectly forcing money into riskier assets like equities.
IG client and CoT sentiment for DAX
Range-trading is generally heavy in the DAX, and yesterday’s price increase has already pushed majority short retail bias into heavy territory, rising 9% to 73%.
DAX chart with retail and institutional sentiment
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