Indices Today: Be Careful of Stimulus and US Jobless Claims

Optimism for fiscal stimulus was the driving force behind the index rally. Next, pay attention to the Initial Jobless Claim announcement to determine your action.

The American indices strongly went up yesterday, supported by US fiscal stimulus hopes. That followed publication of FOMC minutes showing officials calling for government support for the economy. Also, the latest opinion polls suggest that Biden is widening his lead against Trump in the presidential election.

During today’s Asian trading session indices continued moving up, the S&P and Dow Jones Industrial Average are even at the highest levels since the half of the September this morning. From the data front, the markets will be focused on initial jobless claims in the US. Anyway, let’s start the analysis.

S&P 500

The S&P 500 is doing really great after Tuesday evening. The price is strongly going up without any real stops. Now it is getting close to the R1 resistance level, so the bears will probably decide to counterattack pretty soon. Their goal is likely to go down to the Pivot Point or maybe even test the EMA 200. However, if the buyers don’t stop generating firm demand the price might even breach the R1 and hold above it.

NASDAQ 100

NASDAQ 100 looks pretty the same at the moment. It is also rising strongly without any real breaks and it’s getting close to the R1 resistance level. The only difference is that the EMA 200 is already above today's Pivot Point, so the bears would rather try to reach the moving average, not necessarily the PP. However, it is more likely that the buyers will continue generating sufficient demand if nothing unexpected happens.

Dow Jones Industrial Average

The DJIA index looks exactly the same as the S&P 500 today. So, it is significantly going up and the bulls are trying to reach the R1 resistance level. The bears will likely try to react pretty soon. Their goal will probably be going down to the Pivot Point or maybe even testing the EMA 200. However, if the buyers don’t stop generating firm demand the price might even breach the R1 and hold above it.