Large Cap Indexes Have Declined With NAS100 Showing Relative Weakness; Bank Earnings Add To Volatility

Daily

Below are the daily charts of the Dow Jones Industrials (US30 on the left), the SPX (SPX500 in the middle), and the Nasdaq (NAS100 on the right). Of the three, the US30 is showing relative strength and is positioned between its blue bands. This area is considered neutral. However, SPX500 and NAS100 are both trading in the areas between their lower blue and red bands, which are bearish zones. Of the two, the NAS100 is showing the relative weakness, with more candles in the bearish area. Moreover, its red Bollinger bands are moving in opposite directions, which denotes volatility expansion. All three indexes also show a softer momentum since that of the beginning of 2022. This is evident by their respective lower stochastic readings (aqua rectangles).


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Hourly

Below are the hourly charts of the Dow Jones Industrials (US30 on the left), the SPX (SPX500 in the middle), and the Nasdaq (NAS100 on the right). All three indexes are trading in their respective bearish areas pre-cash open. Moreover, the last candles are long red candles, which indicate emotional selling. All of the indexes' respective stochastics have turned down towards the 20 levels (aqua rectangles). If they maintain this position, prices will likely continue under pressure. The geopolitical tensions over Ukraine, the hawkish Fed, and Omicron are all contributing to risk-off sentiment. To add to the volatility, banks report today before the opening bell. Wells Fargo has topped estimates but Citi has posted profit declines. JP Morgan Chase & Co has pulled back pre-cash open despite topping Q4 estimates.


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References:
cnbc.com

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

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