NASDAQ, Dow Jones and S&P 500 Forecast – US Indices Sit Patiently

NASDAQ 100 Technical Analysis

The NASDAQ 100 has gone back and forth during the early hours on Tuesday to essentially sit still. We also have the 50 day EMA sitting just below it and it does seem as if it is offering some kind of support. So, all of that tied together tells me this is a market that’s just kind of hanging out, killing time.

If we were to break down below the 50 day EMA, then it’s possible that we could drop down to the 19,000 level over the longer term, but that could also happen in a flash overnight, depending on what happens in the US election. Quite frankly, this is not a market to trifle with, but if we get some type of sharp pullback, it would not surprise me at all to see the market completely recover.

Dow Jones 30 Technical Analysis

The Dow Jones 30 is very similar in the sense that it is hanging around the 50-day EMA and the crucial $41,900 level. A move down below that level opens up a move to the 41,000 level over the longer term. But as things stand right now, again, I think that would be a short-term knee-jerk reaction to election results more than anything else. I really don’t see the trend changing unless something completely unforeseen happens. As things stand right now, though, I think we’re just looking for a reason to go higher.

S&P 500 Technical Analysis

The S&P 500 is also sitting on the 50-day EMA at the 5,712 level. All things being equal, if we do pull back from here, I believe the 5,650 level should be support. Anything below there could open up another 250 pip loss, but again, I think your biggest concerns here are going to be short-term sharp knee-jerk pullbacks, which in the end, should offer buying opportunities.

Quite frankly, this is a very difficult thing to trade and most professionals get it wrong. So don’t be afraid to sit this one out at least for a while, at least until we know how the election turns out because remember right after the election, two days later, we get an interest rate decision out of the Federal Reserve.

For a look at all of today’s economic events, check out our economic calendar.