Large Cap Momentum Declines With NAS100 Showing Relative Weakness

  • NAS100
    (${instrument.percentChange}%)
  • SPX500
    (${instrument.percentChange}%)
  • US30
    (${instrument.percentChange}%)

Daily

The daily charts below show the DJI (US30) on the left, the SPX (SPX500) in the middle, and the Nasdaq (NAS100) on the right. All three indexes dropped following the release of the Fed's December minutes last week. Of the three, the NAS100 shows relative weakness and is between the lower blue and red bands. The US30 and SPX500 are in the neutral areas between the blue bands, with the US30 showing relative strength. We also note the stochastic declines as bullish momentum evaporated. The NAS100's stochastic is approaching its lower quintile (aqua arrow). This is to be monitored because if the stochastic does drop below 20 and maintains, it will suggest a growing downside momentum.


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Hourly

The pre-market open charts indicate a bullish momentum for the US large-cap indexes. All three are positioned between their respective upper blue and red bands. These are regarded as bullish areas. Moreover, their short-term stochastics suggests bullish momentum on the hourly charts. However, given the waning momentum on the daily, if the hourly stochastics drop below 80, it may signal that shorts are targeting the current rally. Therefore, caution is warranted.


Past Performance: Past Performance is not an indicator of future results.

Russell Shor

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.

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