FUNDAMENTAL
OVERVIEW
The Nasdaq surged into new
highs yesterday after the announcement of a two-week ceasefire. However, the
market didn’t extend the gains as some negative news weighed a bit on the risk
sentiment.
The main culprit was Israel
launching a large wave of strikes on Lebanon, triggering backlash, with Iran
insisting that Lebanon was included in the ceasefire agreement.
For now, the ceasefire is
still holding, at least until tomorrow, when the US-Iran negotiations are set
to take place in Islamabad. The talks could also be extended if both sides
agree. This is keeping markets in check.
There’s still a risk that
the conflict could restart at any moment, since the US and Iran have not officially
ended the hostilities. Nonetheless, the short-term bias has turned more bullish,
as traders reprice the negative growth expectations. Having said that, the sentiment
could reverse quickly if negotiations fail and the war resumes, so all eyes
will be on Islamabad tomorrow.
NASDAQ TECHNICAL
ANALYSIS – DAILY TIMEFRAME
On
the daily chart, we can see the Nasdaq surged into the 25,200 level following the ceasefire
announcement before pulling back a bit. The sellers stepped in around the
25,200 level with a defined risk above it to position for a drop into new lows.
The buyers, on the other hand, will look for a break higher to increase the
bullish bets into new all-time highs.
NASDAQ TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME
On
the 4 hour chart, we have a minor
support zone around the 24,700 level where we can also find the broken downward
trendline. If the price gets there, we can expect the buyers to step in with a
defined risk below the support to keep pushing into new highs. The sellers, on
the other hand, will look for a break to extend the pullback into the upward trendline.
NASDAQ TECHNICAL
ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, there’s
not much we can add here as from a risk management perspective, the buyers will
have a better risk to reward setup around the support or the upward trendline, while
the sellers will look for downside breaks to increase the bearish bets into new
lows. Tomorrow, we conclude the week with the US CPI report and the
University of Michigan Consumer Sentiment survey. As a reminder, we have also
the US-Iran negotiations in Islamabad tomorrow which is going to be more
important than the economic data
