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Nasdaq 100 Leads Stocks Higher as Jackson Hole Symposium Kicks Off

Stocks and Bonds Up, Dollar Down (For Now): Top Trading Opportunities

Nasdaq 100, S&P 500, Federal Reserve – Talking Points

  • Nasdaq 100 struggles to build on bids above 13000
  • S&P 500 fails again at resistance around 4185
  • Fed Chair Powell, PCE data slated for Friday morning

Stocks are pushing higher as the markets look to Friday’s slate of risk events for near-term direction. Tomorrow will see Federal Reserve Chair Jerome Powell deliver remarks following the release of PCE data at 8:30 EST. Stocks have cooled in August after a sharp rally in July, and Friday’s events could spark a sharp move across financial markets. Price action has been jittery into the Jackson Hole Symposium, with light volumes indicating traders are on edge as to what the message from Jerome Powell might be. The recent rise in risk assets may get talked down, as Powell and co. view asset appreciation as an easing of financial conditions. With Fedspeak being perceived as hawkish of late, the stage is set for Jerome Powell to enlighten market participants on where the Fed stands in its battle against inflation.

S&P 500 5 Minute Chart

Chart created with TradingView

S&P 500 futures (ES) continue to trade below 4200 as we head into Friday. Following an initial spike during the first hour of trade this morning, price has slowly fallen to the middle of the recent trading range. Price has been penned in between 4120 and 4184 as traders lack conviction ahead of tomorrow’s potentially monumental session. Price may look to coil around 4160 into the close of Thursday’s trading session. Earlier this week, bears were unable to push below the 4120 region, indicating that a near-term bottom may be in.

On the hourly timeframe, price has continued to hold above the 4160 level, despite long wicks into the abyss below. If price can take out this week’s highs at 4185, ES could look to squeeze to key Fib resistance at 4244. If Powell comes out hawkish, the lows may come under serious pressure and 4100 could come into play quickly.

S&P 500 1 Hour Chart

Nasdaq 100 Leads Stocks Higher as Jackson Hole Symposium Kicks Off

Chart created with TradingView

The Nasdaq 100 has firmly outperformed during today’s session as US yields and the US Dollar both come under pressure. A better-than-expected revision to Q2 US GDP this morning helped bolster sentiment, with Nasdaq 100 futures (NQ) soaring to test 13100 early on in the session. Despite cooling from those intraday highs, price continues to hold above the key 13000 level. Bulls can take comfort in the fact that price remains protected by both psychological support at 13000 and rising trendline support.

Should tomorrow’s PCE data come in soft, NQ could fly should US Treasury yields continue to come in. Recent Fedspeak has hinted that policy may need to be pushed into restrictive territory, potentially meaning a Fed Funds rate above 4% by year-end. So long that the rates market remains on a knife edge, NQ will follow suit.

Nasdaq 100 1 Hour Chart

Nasdaq 100 Leads Stocks Higher as Jackson Hole Symposium Kicks Off

Chart created with TradingView

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— Written by Brendan Fagan

To contact Brendan, use the comments section below or @BrendanFaganFX on Twitter


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