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The balancing act on Wall Street with a strong Dow Jones and a weak Nasdaq at the same time has been very confusing for the Euronext in recent days. It decided to make a brief breakout attempt on the downside, but held the level of around 18,350 points until midweek. After that, this mark looked like a “spike” in the chart image of the morning analysis from July 20, 2024.
However, it should be started again, because the recovery potential on the upside was limited. We quickly slipped back to the lows from the pre-market and even below. At the same time, the strength in the US futures also decreased again. By early midnight, however, the index had recovered once again and was temporarily trading at the 18,536 mark. This is considered to be the range area from Friday, which we had already seen a test of on Wednesday. With this rebound, however, the last fantasy of rising prices on yesterday’s trading day was dashed and the index marked new daily lows. They were accompanied by sales on the Nasdaq and this time also on the Dow Jones and led to a closing price at the daily low.
With this momentum towards the end of trading, the question for the further course is whether the weekly lows that were formed on Wednesday will provide a hold. If the area does not hold, 18,200 is the next technical target in the chart.
Looking at the pre-market and the data from JFD, no decision has been made, but a test of the weekly low directly at the opening is likely.
It must be address that Wall Street developments should be separately.
Dow Jones and Nasdaq with losses
First, we saw a continuation of the switch in the US market, which is moving from technology stocks to blue chips. The Nasdaq immediately reversed a pre-market recovery and closed its gap, while the Dow Jones rose to a new record level.
But later on, a correction was initiated here too, which totaled around 700 points and initially cost the Dow Jones all its gains, then later pushed it significantly into the red. In the medium term, we have thus corrected half of the breakout above 40,000 points.
While this was “only” a correction, the downward trend in the Nasdaq intensified and led to new lows. These formed an intraday double low, which can now also be significant in the medium-term chart picture on the threshold of 19,600 points from the start of July.
The decline thus widened and exceeded the level of 1,000 points or around 5 percent from the all-time high. A movement that can of course be corrected again at some point, but the timing is difficult to determine in the currently very volatile environment. Recovery tendencies such as those seen at the start yesterday should therefore be treated with caution for the time being.
In summary, a negative day for all Wall Street indices, which are anchored and depending this morning overview together with the Asian markets.
In the morning we received data from the UK on consumer confidence and retail that the United States markets were struggling.
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