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Nasdaq – Leads the way in otherwise mixed trade

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  • Nasdaq outperforms other indices
  • Fed officials remain cautious
  • NAS100 breaks major technical resistance

Stocks traded a little mixed in Europe and the US on Tuesday, the one outlier being the Nasdaq which powered ahead with gains of more than 1%.

Lower bond yields enabled stocks to bounce back strongly in the second half of last week, aided by some less hawkish Fed commentary after the meeting and a softer jobs report.

But with yields now stabilizing again, equities have been running low on energy and may generally require another boost from the data or central bank.

Fed officials remain extremely cautious, fearing stopping too soon and suffering another onslaught of criticism for underestimating the inflationary pressures. And we’re seeing that again, with Kaskari claiming it’s too soon to declare victory and that doing too much is preferable to too little.

A major breakout

The Nasdaq has been the clear outperformer today and it’s broken a key technical level in the process.

NAS100 Daily

Source – OANDA on Trading View

As mentioned yesterday (Nasdaq – Rally running on fumes after Fed and NFP boost) it appeared the rally may have run out of steam – as we’re continuing to see in other indices – but the breakout today appears to have changed that.

Not only have technical resistance levels now been broken, but momentum looks healthy at this moment. It’s running into some resistance around the October highs which may stall things slightly but today’s breakout is arguably more significant.

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Craig Erlam

Craig Erlam

Former Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary.

His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News.

Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
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