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US Equity Futures Supported by Earnings Despite Hawkish Fed

US Equity Futures Supported by Earnings Despite Hawkish Fed

Tammy Da Costa, Analyst

NASDAQ, DJI, S&P 500 Latest

  • US equity futures turn positive while volume subsides
  • Nasdaq lags as tech stocks monitor China restrictions as descending triangle holds
  • Dow Jones rises above Fibonacci support while a softer USD drives gains

Read: S&P 500 a Volatility Risk While the Dollar Falls Back to a Reliable Theme: Fed Hikes

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Nasdaq 100, S&P 500 and Dow Jones are trading higher despite growing fundamental risks. Despite news that China restrictions will remain intact for the foreseeable futures, positive earnings from Analog Devices (ADI) and an uptick in profit margins for Best Buy (BBY) provided some relief for Nasdaq which is lagging its US counterparts.

With the Thanksgiving holiday shortening the US trading week, durable goods orders, Michigan sentiment and the FOMC minutes could still provide a catalyst for US stock indices.

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With interest rate forecast predicting an 81% probability of a 50bps interest rate hike at the December Fed meeting, fundamentals remain key for assessing the resilience of the US economy.

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Nasdaq 100 Technical Analysis

For tech heavy Nasdaq 100, price action continues to grapple the Fibonacci retracement of the ’20 – ’21 move providing resistance around 11700. As demonstrated on the weekly chart below, the the full-bodied candles that developed throughout June and July highlighted a strong zone of resistance which has come back in play.

After the 10 November CPI (consumer price index) print fueled a bull rally, a rejection of the upper wick at 12118 drove Nasdaq 100 futures lower before opening the week at 11723.

Nasdaq 100 Weekly Chart

Chart  Description automatically generated

Chart prepared by Tammy Da Costa using TradingView

For bullish momentum to hold, a break of 17000 and 11728 could drive prices back towards the November high at 12118. As volume decreases, a drop below 11500 could fuel the downside move.

Nasdaq 100 Daily Chart

Chart  Description automatically generated

Chart prepared by Tammy Da Costa using TradingView

With Dow Jones continuing higher, the 34000 handle could continue to hold steady while a move higher paving the way for the August high of 34246.

Dow Jones Future Daily Chart

Chart, line chart  Description automatically generated

Chart prepared by Tammy Da Costa using TradingView

Wall Street Mixed
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -18% -5% -9%
Weekly 27% -17% -7%
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--- Written by Tammy Da Costa, Analyst for DailyFX.com

Contact and follow Tammy on Twitter: @Tams707

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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