|

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..."
 

    1. R3 2383.75
    2. R2 2379.50
    3. R1 2377.00
  1. PP 2372.75
    1. S1 2370.25
    2. S2 2366.00
    3. S3 2363.50

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

More from Haresh Menghani
Share:

Editor's Picks

AUD/USD consolidates above 0.7000; remains close to monthly top

AUD/USD holds steady above 0.7000 during the Asian session on Friday, trading just below the previous day's monthly low amid diverging forces. A hawkish RBA continues to support the Aussie, while the recent decline in US bond yields keeps the US Dollar depressed near a three-week low. However, oil-driven inflation fears reinforce Fed hike bets, which, along with geopolitical risks, could benefit the safe-haven buck and cap the currency pair.

USD/JPY bounces off one-month low; climbs to 157.00 amid reviving USD demand

USD/JPY rebounds from the 156.00 neighborhood, or a one-month low touched during Friday’s Asian session, with bulls looking to extend momentum beyond 157.00 amid the emergence of some US Dollar buying. Meanwhile, Japan's National CPI rose to a nine-month peak and reaffirmed BoJ rate-hike bets, which could support the Japanese Yen and cap gains for the currency pair.

Gold treads water around $4,000

Gold prices maintain its offered stance in place at the end of the week, hovering around the key $4,000 threshold per troy ounce. The persistent selling bias in the precious metal comes amid decent gains in the US Dollar and an acceptable rebound in US Treasury yields across the curve, all alongside further upside traction in crude oil prices.

Crypto Today: Bitcoin holds the 50-day EMA as Ethereum and XRP face structural resistance

Bitcoin gradually ticks up on Friday, trading above $81,000. The Crypto King has recently defended structural support near $80,000, reinforcing the prevailing bullish outlook. Ethereum similarly edges higher above $2,400, while Ripple trades above $1.32 after testing support around $1.30.

The French bond panic is overdone. Here's what the market is misreading 

France's 10-year government bond yield has climbed above 5%, reigniting fears of a sovereign debt crisis in the Eurozone. With public debt exceeding €3.5 trillion, persistent budget deficits and a fragmented political landscape, investors are increasingly questioning the French government's ability to stabilize its finances.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.