Weekly Market Report: Dow, Nasdaq, & DAX
Fresh record highs for US indices as easing expectations fuel risk-on sentiment.
WALL STREET: Fresh record high as Dow tops 27000 ahead of earnings releases this week
The fresh record high in US indices is capturing market focus, buoyed by expectations of Fed rate cuts not just later in the month, but also later in the year. While the bullish moves have been aiding institutional traders who positioned themselves into an extreme long bias of 82%, they’ve been squeezing retail bias that has edged deeper into extreme short territories of a near opposite 79% as longs continue to get enticed into closing out while shorts average-in anticipating retracement. Earnings from major companies is this week, with financials on Monday and Tuesday from the likes of Citigroup and JPMorgan respectively.
US TECH 100: Fresh record close ahead of earnings from tech titans later this week
The tech index’s mid-term resistance level has been breached as US indices post record highs, but there’s no denying the Dow outperformed this past week and posting record highs far from its previous mid-term resistance level. Institutional bias here is also majority short, though not at the extreme levels as the Dow, opting instead for a more modest majority long 58% that has declined slightly on the back of a reduction in longs by 1.5K lots. Retail bias has been inching higher into majority short territories and getting squeezed here as well, though not to the extent as retail traders in the Dow as the moves higher here haven’t been as harsh and has tended to offer more retracement instead.
GERMANY 30: Retracing off the highs as its mid-term resistance level holds, retail bias shifts to the middle
Seven consecutive trading days of red has certainly dented the index’s bullish prospects as its mid-term resistance level continues to hold. While ECB easing is expected to aid shares, the combination of dismal earnings expectations, weakening data, and a trade war with the US has dawned on the bloc and hit share prices in the process. That however, has aided retail traders whereby majority short bias of 67% as of last Monday has disappeared on short profit-taking, and putting the bias squarely in the middle at the start of this week. From a technical standpoint, its price is on the verge of crossing below the 100-day moving average, with more technical indicators turning neutral instead.
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