Dow, Nasdaq and DAX register fresh gains

Dow Technical analysis, overview, strategies, and levels

After three times testing yesterday's 1^st Resistance level, it finally blew past it for a breach that gave conformist buy breakout strategies an eventual outperforming strategy. This was despite domestic unrest, with Asian and European indices outperforming. Nearly all its components finished in the green lead by Dow and American Express. Energy and materials led the gains when it comes to US sector performance, with consumer staples gaining the least. In US data, Wards vehicle sales were well below expectations, and up next we'll get ADP's (Automatic Data Processing) non-farm estimate, ISM's (Institute for Supply Management) non-manufacturing PMI (Purchasing Managers Index) expected to show ongoing contraction, and factory orders expected to show big contraction for a second reading in a row.

IG client^* and CoT sentiment for Dow

Retail short bias has risen here to a heavy 66% with longs ever more enticed into closing out.

Dow chart with retail and institutional sentiment

Nasdaq Technical analysis, overview, strategies, and levels

While the tech-heavy Nasdaq finished higher yesterday, it failed to offer any pivot point action opting to remain within yesterday's key levels. And though there were plenty of outperformers with QUALCOMM and Align Technology gaining the most, there were quite a few in the red including Gilead Sciences with another drop following recent preliminary results of its coronavirus drug, and Alexion Pharmaceuticals. In earnings, Zoom's figures beat expectations but costs rose, its share price surging in after hours before retracing back down.

IG client^* and CoT sentiment for Nasdaq

Unlike in the Dow where retail short bias is rising, here shorts are getting stopped out and fresh traders are getting enticed into hopping onto what has been a bull run thus far, and hence heavy short bias has dropped from a previous 71% to 67%.

Nasdaq chart with retail and institutional sentiment

DAX Technical analysis, overview, strategies, and levels

European and Asian equities (at three-month highs) have been registering big gains especially as Chinese data impresses with this morning's surprise expansion in Caixin's services PMI. That meant the DAX was in for big gains, with its 1^st Resistance level yesterday holding a couple times before getting breached with its price crossing and closing above the last of its main long-term moving averages, the 200-day MA. All its components finished in the green save for Wirecard, with MTU Aero Engines and Daimler the outperforming stocks. We'll get German employment and services data today.

IG client^* and CoT sentiment for DAX

While range-trading is usually heaviest here which had taken majority short bias amongst retail traders to 74% yesterday morning, those fresh and averaged-in shorts are getting severely tested with the bullish moves, and the short bias has dropped slightly to 71% as of this morning.

DAX chart with retail and institutional 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.

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