NASDAQ Index, SP500, Dow Jones Forecasts: Unemployment Drops, Building Permits Soar, Fueling Market Optimism

Key Insights

• Unemployment claims fall to 187K; Building Permits at 1.50M, signaling robust U.S. economic health.
• Tech sector’s surge led by Taiwan Semiconductor, boosts NASDAQ, SP500, and Dow Jones forecasts.
• Apple’s shares jumped 1.6% following an optimistic upgrade from BofA.

Quick Fundamental Outlook

As the US indices gear up for a positive shift, the latest data shows Unemployment Claims dropping to 187K, significantly below the forecast of 203K, reflecting a robust labor market. Concurrently, Building Permits have risen to 1.50M, surpassing expectations and indicating a healthy construction sector.

This economic backdrop sets the stage for a surge in tech stocks, with U.S.-listed Taiwan Semiconductor leading the charge, soaring 5.5% on the back of a predicted 20% revenue growth in 2024, driven by strong demand for advanced chips.

Alongside, stocks like Nvidia, Microchip Technology, Marvell Technology, and AMD are witnessing increases between 1.6% and 3.2%. Mega-cap stocks such as Microsoft, Tesla, and Meta Platforms are also on the rise.

Apple’s shares jumped 1.6% following an optimistic upgrade from BofA. This collective momentum in technology equities is expected to underpin the NASDAQ Index, SP500, and Dow Jones, painting a bullish outlook for these indices.

SPX SP500 Price Forecast

The S&P 500 Index (SPX)‘s pivot point stands at $4,715.41, with immediate resistance levels at $4,763.06, $4,794.55, and $4,819.15. Support is found at 4680.5, followed by $4,644.67 and $4,600.00.

Technical analysis shows the 50-day Exponential Moving Average (EMA) at $4713.04 and the 200-day EMA at $4531.83, both suggesting potential support zones.

SPX continues to trade within an ascending triangle pattern, displaying resistance at $4794.55 and support around the $4715.41 level, where the 50 EMA converges, indicating a possible buying zone above this level. The overall trend for SPX is bullish above the $4715.41 mark.

Dow Price Forecast

On January 18, the Dow Jones Industrial Average (DJIA)’s pivot point at $37259.17. The index faces immediate resistance levels at $37441.77, $37624.38, and $37803.62. On the support side, the immediate level is at $37126.02, followed by $37020.17 and $36819.53.

The 50-Day Exponential Moving Average (EMA) is positioned at $37441.59, closely aligned with the first resistance level, while the 200-Day EMA stands at $36939.72, near the pivot point, suggesting potential zones of resistance and support.

A key observation is the upward trendline that has been prompting buying around the $37126.02 level. The formation of a bullish engulfing candle pattern also supports this buying trend, indicating a growing bullish momentum. The overall trend for the Dow Jones is bullish above the $37259.17 mark.

NASDAQ Price Forecast

On January 18, the NASDAQ Composite Index’s 4-hour chart presents a pivot point at $14,737.32. The index faces immediate resistance levels at $14,948.28, $15,155.20, and $15,360.15. Support levels are identified at $14,638.69, $14,485.78, and $14,267.86.

The Relative Strength Index (RSI) stands at 53, indicating a neutral to slightly bullish market sentiment. Technical indicators highlight the 50-Day Exponential Moving Average (EMA) at $14,747.13 and the 200-Day EMA at $14,094.15, both potentially impacting the index’s trajectory.

A symmetrical triangle pattern is observed, suggesting a consolidation phase. The 50 EMA provides support around $14,747.13, which could play a pivotal role in the index’s short-term movement. Overall, the trend for the NASDAQ is bullish above the $14,737.32 level.

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