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S&P 500 Start the Fed Week on New Record High

Dow Jones
Dow Jones

Wall Street indices started in positive foot the first hour of the trading week on hopes of an interim trade deal, with the S&P 500 adding 0.60% at 3,036. The Dow Jones trading 0.45% higher at 27,089, while the Nasdaq trading 0.90% higher at 8,317 after positive headline news from Brexit negotiations. Strong earnings and a 94% probability of interest rates cut by FOMC on Wednesday added to bullish momentum.

Last week the Fed Chair Jerome Powell, reiterated that the Fed would “act as appropriate to support continued growth, a strong job market, and inflation moving back to our symmetric 2% objective”, leaving the door open for further cuts by the end of the year. On the data front the Dallas Fed Manufacturing Index slumped to 5.1 in October vs. 1.4 expected.

The CBOE Volatility Index or fear index is adding 0.31% at 12.97 to confirm the positive market mood.

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S&P 500 Support and Resistance

S&P is getting a boost by strong earnings release before the market open which drives the index at two-week highs. S&P 500 bullish momentum is intact as it trades above all major daily moving averages. On the upside immediate resistance stands at 3,041 today’s high while more pressure will be met at 3,050 psychological mark. S&P has formed a strong floor at 2,822 during August which absorbed all the offers and signalled the rebound which drove the index to all-time highs. On the downside S&P 500 first support stands at 3,018 today’s low and then at 3,000 Friday’s low. Traders looking to enter long positions can buy if the index closes above today’s high, targeting the 3,100 level for profits, and can keep their long positions as far the index is trading above the 2,950 mark.

The European indices trading higher, the FTSE 100 is 0.14 percent higher at 7,334 as the pound trades above 1.2860. DAX index trading 0.56 per cent higher at 12,960 while CAC 40 in Paris also trading 0.25 per cent higher at 5,736.

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