NASDAQ, Dow Jones And S&P 500 Outlook For This Week
Francesco Bergamini | Mar 21, 2022 02:45AM ET
The S&P 500 had a decent last week, up by + 6.11%. For the week ahead, we confirm a possible consolidation between 4.350 - 4.470.
Indicators
The week just ended saw the upward break of the bearish trend that began in January 2022. This break was also supported by the MACD and RSI indicators which, in our opinion, herald an optimistic scenario for the short-medium term.
MACD crossed to the upside but is currently still below the 0 line (negative momentum), and RSI has also broken the bearish trend line upwards.
Given the important breaks, both on the price and the indicators, we believe that the index can retrace slightly by carrying out a back-test of the previous breaking points and then continue rising. Specifically, a retracement in the area of 4.375 could give rise to further upside.
- Support at 4.375
- Resistance at 4.535
The NASDAQ ended the week up + 8.97%. For the week ahead, we expect a possible consolidation between 14,000 and 14,450.
Indicators
Volatility, in our opinion, will remain high on the technological index. The upward break of the bearish trendline is a good indicator that can herald a change of pace in short to medium term.
Given the strong price action, especially in the last two sessions, we could expect lateralization first and then a continuation of the bullish price action: a possible consolidation is also supported by the concomitance with the 50-day moving average (often area of concentration).
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MACD and RSI are picking up, especially the second is now above the 50 line.
- Support at 13,855
- Resistance at 14.450
DOW JONES (DJI)
The Dow Jones Industrial Average had a week up + 5.09%. For the week ahead, we expect a possible consolidation between 34,800 and 34,400.
After this week, the index has returned to the top of the broad bearish channel and within the broad sideband 33,600 - 35,515 in existence since April 2021.
Given the strong upside of the last three days, combined with the coincidence of the 50-day moving average, we believe that the index may retrace slightly and then continue upwards.
MACD and RSI supported the rise in the index, which makes the scenario optimistic for the short-medium term. In particular, the latter broke the long bearish trendline that began in November 2021.
Specifically, we believe that a slight retracement to at least 34,000 can lead to subsequent bullish price action.
- Support at 33,600
- Resistance 35.515
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