NAS100 on the Back Foot Ahead of Big Tech Earnings Barrage
NAS100 Analysis
The tech-heavy index has entered a consolidation mode after the first-quarter rally, which culminated to 2023 highs at the beginning of the month, overlooking the banking turmoil. Fears over the health of the financial system creep back in though, as First Republic Bank disclosed massive deposit outflows in Q1 due the SVB collapse fallout. [1]
Furthermore, investors contemplate persistent inflation, prospects of economic slowdown and restrictive stance by the Fed – all headwinds for Wall Street. Right before the communication blackout period, a series of policymakers offered hawkish commentary, supporting the higher-for-longer narrative, against market expectations for multiple rate cuts later this year.
Focus now shifts to the upcoming GDP figures and the latest PCE Inflation report, ahead of next week's policy decision by the Fed, while earnings from tech heavyweights are another major focal point this week. Alphabet and Microsoft are due on Tuesday, Amazon.com on Thursday, while Meta reports on Wednesday.
The Facebook-parent appears to be shifting its focus away from the metaverse, towards generative AI. More to it CEO Mark Zuckerberg haw vowed to make the firm more efficient after its 2022 hardships, with markets having reacted positively to both these efforts.
NAS100 remains subdued right on the cusp of a bull market, awaiting the aforementioned upcoming events for direction, threatening the EMA200 (black line). Daily closes below it will expose the index to the 12,400 region, but we are cautious at this stage for sustained weakness below it. Above the EMA200, bulls are in the driver's seat, although they will need a catalyst to push towards 13,742.
Nikos Tzabouras
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.
With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.
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