With just a week left of the month, the NAS100 August candlestick (blue arrow) shows interesting price action. Initially, the month was bearish, with bears taking the index down to the month low of 14,555. However, the bears lost control at this level with the bulls taking over. The bulls have pushed price back up to the 15,350 levels and remain in control. We caution that the monthly candle is still to complete but the underlying sentiment is currently bullish.
Moreover, we note that the green 5-month EMA is above the orange 10-month EMA, with angle and separation. EMAs are trend-following indicators, suggesting that a bullish monthly trend is in motion. The monthly RSI remains on the bullish side of 50 (blue rectangle). This connotes that there is an underlying long-term momentum, which is supporting the index.
The turning point for the month was the release of Nvidia's results. Artificial intelligence and its evolution remain a key driver for the market. The company outlook was especially encouraging. For Q3, it forecasts revenue at about $16bn, which is far above the analyst forecast of $12.6bn. Nvidia CEO Jensen Huang said that "The race is on to adopt generative AI."
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.