The Trade: Tesla and Alphabet miss earnings, Nasdaq’s ugly week
IG's Tony Sycamore explores NASDAQ's critical support level, Bitcoin's rally and consolidation, crude oil's six-week low, gold's potential decline, and the Australian dollar's downward pressure amid weak Chinese economic data.
[AI generated]
This video was created on 25 July for IG audiences by ausbiz.
IG’s Tony Sycamore provided an in-depth analysis of key market trends affecting major indices and commodities. He emphasised the precarious position of the NASDAQ, which, after a rough patch, is showing signs of further potential decline if it breaches the $19,500 support level. This critical support level could lead to a significant drop if broken, reflecting the market's sensitivity to recent earnings reports from major tech names like Tesla and Alphabet.
NASDAQ's critical support level at risk
In the crypto space, Bitcoin has experienced a notable 28% rally over the past two weeks. However, Sycamore points out that the market is currently in a consolidation phase. For the bullish momentum to continue, Bitcoin needs to break above its trend channel resistance and the $74,000 high from March. Until then, it remains within a trading range, indicating potential for either further gains or consolidation.
Bitcoin's rally and consolidation phase
Crude oil prices have dipped to a six-week low, influenced by various geopolitical tensions and disappointing Chinese economic data. The decline in crude oil is compounded by the end of the US driving season, which traditionally sees lower demand. Sycamore highlighted the importance of the 200-day moving average as a critical support level, suggesting that a further decline towards $74 could be on the horizon if current trends continue.
Crude oil dips amid geopolitical tensions
Gold, after a brief spike to new highs, has reverted back within its previous trading range. Sycamore suggests that the strengthening US dollar could push gold prices lower, potentially towards the $2,275 mark. This reflects ongoing market uncertainties and the impact of global economic factors on precious metals.
Gold reverts to previous trading range
The Australian dollar is facing downward pressure due to weak Chinese economic data and declining commodity prices, such as copper and iron ore. The Aussie dollar has broken below its uptrend support from April, indicating potential for further declines. Sycamore also notes the uncertainty surrounding the Reserve Bank of Australia's future rate hikes, which adds to the currency's challenges.
Australian dollar faces downward pressure
Finally, the ASX 200 index is struggling due to its exposure to the Chinese market. Despite reaching new highs recently, it is now testing critical support levels. Sycamore emphasised the importance of the 7900 support level, noting that a break below could signal a deeper decline for the ASX 200.
Overall, Sycamore’s analysis underscores the volatility and interconnectedness of global financial markets, highlighting the need for investors to stay informed and responsive to economic indicators and geopolitical events.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
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. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
Explore the markets with our free course
Discover and learn how the range of markets you can trade on with IG Academy's online course – ‘Introducing the financial markets’.
Put learning into action
Try out what you’ve learned in this shares strategy article risk-free in your demo account.
Ready to trade shares?
Put the lessons in this article to use in a live account – upgrading is quick and easy.
- Trade on over 10,000 popular global stocks
- Protect your capital with risk management tools
- React to breaking news with out-of-hours trading on 70 key US stocks
Inspired to trade?
Put your new knowledge into practice. Log in to your account now.
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.