NAS100 Cautious Ahead of Netflix and Tesla Earnings
NAS100 Analysis
The US central bank has been preparing markets for more aggressive monetary tightening, after last month's rate lift-off, with Mr Bullard not ruling-out a 75 basis point hike yesterday, although it is not his "base case". [1]
Markets are very aggressive in their pricing and CME's FedWatch Tool projecting a half-percentage point adjustment at May's upcoming meeting, with 91% probability at the time of writing. [2]
A high interest rates environment is typically not good for growth and the tech sector, with NAS100 having erased around 9% of its value during the first quarter.
Following the positive return from the long weekend, the index trades with caution today as markets are on edge, monitoring China's Covid-19 situation, the war in Ukraine and Fed's tightening prospects.
On the daily chart, the index has been having a poor month and has been testing the lower border of the Ichimoku cloud, daily closes above which can lead to further losses. Another factor that potentially points to further downside bias, is the Death Cross that was formed in late February-early March. It is the move of the faster EMA50, below the slower EMA200, which is often a precursor of sustained weakness.
Looking at the four-hour chart, immediate bias remains on the downside, since NAS100 trades below the EMA200 (black line) and is exposed to 13,464, although fresh impetus may needed for new 2022 lows (12,941). Despite that, the index tries to resist to downward pressure and it could find the chance to push for the EMA200 (at around 13,350-13,400). Daily closes above it, can pause the downward momentum, but the index does not inspire much confidence at this stage for a test of 14,856.
The US earnings season is underway in the US, and the technology sector is front and center this week and the next. Netflix is the first of the FAANGs to report, as its results are due today after market close, with EV king Tesla following on Wednesday.
Investors will be eagerly anticipating Netflix's subscription figures, after January's disappointing forward guidance that had caused the stock to plunge, while Tesla's release comes in a backdrop of record Q1 deliveries, two new factories and its CEO's efforts to acquire Twitter.
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. With extensive experience in market analysis and a strong foundation in international relations, he brings a unique perspective to financial markets. Nikos emphasizes not only technical analysis but also on fundamentals and the growing influence of geopolitics on financial trends.
As a Senior Financial Editorial Writer, he delivers comprehensive and forward-looking insights across a wide range of asset classes, including equities, commodities, and currencies. His work explores how macroeconomic events, political developments, and global policies impact market dynamics, providing readers with a deeper understanding of both short-term movements and long-term trends.
References
| Retrieved 19 Apr 2022 https://www.youtube.com/watch | |
| Retrieved 19 Apr 2026 https://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html# |
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