Nasdaq, S&P 500, Dow: Indices Soar, CPI and Fed Decisions Awaited

Key Insights

• S&P 500 surpasses 5000 milestone, signaling bullish market despite Fed’s rate cut caution.
• NASDAQ approaches record high, reflecting tech optimism amid inflation and policy uncertainty.
• DOW’s resilience highlights mixed market sentiment, eyeing key CPI data for future direction.

Financial Markets Brace for CPI: SPX, NASDAQ, and DOW in Focus

The Dow Jones Industrial Average showed resilience, closing the week flat by overcoming earlier losses, while the Nasdaq Composite soared 2.3%, nearing a record high past 16000. Despite early expectations, market consensus now leans towards a rate cut not before May, with the Federal Reserve hinting at only three reductions in 2024.

The upcoming week’s focus is on the CPI inflation data for January, which could significantly affect the Fed’s policy decisions and investor outlook. This crucial data, alongside consumer sentiment, retail sales, and housing market updates, will likely dictate future market movements across SPX, NASDAQ, and DOW, shaping the broader financial narrative.

In the current financial climate, the SPX index has shown resilience above its pivot point at $5004.22. Technical indicators highlight immediate resistance levels at $5045.10, $5070.03, and $5104.56, suggesting potential hurdles for further gains. Conversely, support levels at $4969.46, $4936.73, and $4906.88 offer a safety net against potential pullbacks.

The 50-day and 200-day Exponential Moving Averages, standing at $4874.41 and $4641.71 respectively, underscore a bullish trend, further solidifying the SPX’s position above the pivotal $5004.22 mark.

Dow Price Forecast

The DOW’s pivot point at $38,742.74, indicating a bullish sentiment in the market, highlighted by resistance levels at $38,807.45, $38,890.37, and $38,983.64.

These markers will test the index’s ability to sustain its upward momentum. On the downside, support levels at $38,573.34, $38,453.16, and $38,310.86 offer potential cushions against any retracements.

The proximity of the 50-day Exponential Moving Average (EMA) at $38,505.16 to the current level underlines the bullish trend, further supported by the 200-day EMA at $37,825.77, indicating solid ground above the pivotal $38,505.16 mark.

The NASDAQ shows a promising technical outlook, trading above its pivot point at $15,908.67. This positioning suggests an optimistic sentiment among investors, with immediate resistance levels set at $16,011.95, $16,104.52, and $16,212.44.

These thresholds must be surpassed to maintain the bullish momentum. Conversely, support levels at $15,741.59, $15,628.40, and $15,523.98 provide potential stabilization zones in case of pullbacks.

The 50-day and 200-day Exponential Moving Averages, at $15,359.11 and $14,504.44 respectively, reinforce the bullish outlook, underscoring a solid uptrend as long as the index stays above the pivotal $15,908.67 mark.

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