US stocks weighed down by slump in oil prices; Fed in focus
|Major US equity indices witnessed a weak opening on Tuesday as investors remained reluctant to carry big bets ahead of the much awaited Fed monetary policy decision.
The central bank is widely expected to go ahead and raise interest rates but investors remain keen to know the timing, and pace of future rate-hikes, and hence preferred to remain on the sideline ahead of the confirmation.
Meanwhile, a slump in oil markets, with WTI crude oil slammed to fresh multi-month lows near mid-$47.00s, further resulted into weaker investor sentiment and contributed to mildly weaker trading sentiment around riskier assets – like equities.
At the time of writing, the Dow Jones Industrial Average was down around 45-points to 20,835, while the broader S&P 500 Index lost over 9-points to 2,364. Meanwhile, tech-heavy Nasdaq Composite Index trimmed nearly 30-points and dropped to 5,850 during opening hour of trade.
Technical outlook
Carol Harmer, Founder at charmertradingacademy.com notes, "we are still holding in the with our long S&P from 2363.....I think there is a good chance the S&P will try for the ATH but then that’s where we offload our S&P and look to sell...Stops tight though because above 2405 and the market should make it to 2425....Downside we are seeing support in the 2367/65 area and also at 2361...so it really is only below 2352 that the market will look weaker..."
"The reason for selling Nas was the Double Top...that is something as a technical trader I have to do....SL tight at 5407...so I am not ris-ing much...want to take profits around 2340....I want a Ferrari as well.....so wanting doesn't make it happen....but I would like to take profits at the 5340 support...Now if this double top breaks....we look for 5436 as a viable targeted area..."
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