Post the Fed's dovish-leaning meeting, stocks, gold, and bonds surged, with yields dipping, prompting speculation about whether the post-Fed rally will last.
For the QQQ, attention is on critical support levels like 434.00 and 439.00, which have acted as strong floors amid recent market volatility.
Nvidia's stock is approaching a pivotal point around the $905.00 area, where breaking resistance could signal a new record high, while failure to do so might indicate a bearish trend reversal.
Following the Fed’s dovish-leaning policy meeting on Wednesday, we saw stocks, gold and bonds all surge higher, causing yields to dip.
Today we will see whether those moves have further legs to run or whether we get the usual post-Fed fade, as traders book profit.
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Futures Extend Gains Index futures managed to extend their gains and some European indexes like the DAX opened in fresh unchartered territories, before pulling back.
We also saw gold prices jump to a new high during the early Asian session, before easing somewhat amid profit-taking and as investors made a more sober assessment of the Fed’s assessment of interest rates.
The FOMC maintained interest rates unchanged for the fifth consecutive meeting on Wednesday, reiterating its stance of waiting for stronger confidence from the inflation data before considering rate cuts.
The key takeaway was that despite recent high inflation readings, the Fed's statement suggests an inclination towards future rate reductions, indicating a potential shift in monetary policy.
Contrary to analysts’ prior expectations, the Fed still expects three rate cuts for this year, but now is more cautious about 2025 cuts.
However, the recent hot core inflation readings and strong performances of some key commodity prices like crude oil and especially cocoa could lead to inflation remaining higher than expected.
This will prevent the Fed and other central banks from being able to ease their policies in the way they envisage.
While the markets remain buoyant for now, and as traders, we have to go with the flow until the charts tell us otherwise. Let's take a look at Nasdaq and QQQ) charts to gain further insight regarding our next moves.
QQQ technical analysis and trade ideas Following Wednesday’s FOMC decision, the major US indexes rallied with the S&P 500 hitting a fresh record high.
