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CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Nasdaq outperforms, Dow and DAX finish higher

Retail bias in heavier short territory for the tech-heavy Nasdaq on a lack of retracement.

NYSE Source: Bloomberg

Dow Technical analysis, overview, strategies, and levels

The Dow managed to undo some of the losses registered the day before, failing to reach either of its key pivot points and in turn unable to offer a strategic play off of the key levels. Amongst its components, Disney, Apple (which hit a record high) and Microsoft were the outperformers, the handful finishing in the red including Dow, Walmart (following its strong session the day before after a report it would launch an Amazon Prime competitor), and Merck. As a sector, materials suffered the heaviest casualties, while tech, consumer discretionary, and financials outperformed. In earnings, Walgreens will be releasing its figures, and when it comes to US data we'll get unemployment claims today expected to remain above a million, and PPI (Producer Price Index) figures tomorrow.

Dow Technical Indicators Source: IG charts

IG client* and CoT sentiment for Dow

A lack of a price drop has meant retail bias remains in majority short territory, rising to 56% as of this morning.

Dow sentiment Source: IG charts

Dow chart with retail and institutional sentiment

Dow Source: IG charts

Nasdaq Technical analysis, overview, strategies, and levels

It's become a common theme for the Nasdaq, its price making fresh highs but offering little beyond its key pivot points, with a break of yesterday's 1st Resistance level once again testing conformist buy breakout strategies on a lack of upside follow through. Chinese e-commerce JD.com outperformed with Biogen (the biotech company submitting an Alzheimer's drug to the FDA for approval), while in the bottom Alexion Pharmaceuticals, Fastenal, and Tesla. From a technical standpoint, all its main indicators are flashing green unlike other indices in this report where although the overview is bullish, it has stalled more heavily and failed to offer fresh record highs.

NASDAQ Technical Indicators Source: IG charts

IG client* and CoT sentiment for Nasdaq

That has also meant that retail short bias is heaviest here by a healthy margin, rising from 70% to 73% on yesterday's price moves and in much greater need of a retracement to unwind shorts initiated at far lower price levels.

Nasdaq sentiment Source: IG charts

Nasdaq chart with retail and institutional sentiment

Nasdaq Source: IG charts

DAX Technical analysis, overview, strategies, and levels

As with the Dow and FTSE, the price movement here was also limiting and within its key pivot points, as its bull trend technical overview stalls heavily near the highs, and where on most days has tested buy breakout strategies with a lack of significant follow through. Amongst its outperformers, RWE and Deutsche Post (whose earnings beat expectations) stood out, and while Wirecards's volatility dropped (relatively speaking), it still experienced the largest percentage change and finishing at the very bottom. A stronger Asian session this morning has taken futures higher and closer to today's 1st Resistance level, and in German data we've got trade expected to show a larger-than-previous surplus.

DAX Technical Indicators Source: IG charts

IG client* and CoT sentiment for DAX

Retail bias here (like the FTSE) is little changed on a relative lack of change in price, but unlike the UK index where the bias is heavy to the long side, here it's majority short.

DAX sentiment Source: IG charts

DAX chart with retail and institutional sentiment

DAX Source: IG charts

*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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This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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