Technical Analysis

Watch Market Sentiment Carefully as Uptrends Hold

Wall Street, Dow Jones, S&P 500, Technical Analysis, Retailer Positioning – Call Points

  • Retailer bets are a hint Dow Jones can be turned down, will S&P to follow?
  • In both indices, upward trends persist, the S&P 500 monitors bearish signals
  • For more information, see the recording of my webinar for this week’s session
How to use IG in the client's mind in your trading

How to use IG in the client's mind in your trading

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How is the IG Client Sentiment a controversial indicator?

At this week’s webinar, IG Client Sentiment (IGCS), a tool for assessing retailer positioning, I discussed the prospects of Dow Jones and the S&P 500. IGCS is usually a controversial indicator. For a detailed analysis, see the recording of the session above, where I discussed how to use IGCS in my trading strategy. I also addressed the main prospects for US benchmark stock indices.

Outlook for Dow Jones Sentiment – Bearish

The IGCS gauge means that about 37% of retailers are Dow Jones net long. Reverse exposure has increased by 10.87% and 15.50% per day and per week, respectively. The fact that traders are short tips may continue to rise. That said, recent mood swings warn that the Dow could turn lower.

Dow Jones, S&P 500 Analysis: Monitor market sentiment closely as uptrends keep up

Technical analysis

From a technical point of view, Dow Jones futures consolidations continue at just under 61.8% of the Fibonacci extension 34269. Turning the focus down to the 20-day simple moving average and extension center 33552. Removing them would then reveal growing support from March 2020. However, this could maintain the dominant in the event of a short-term appeal.

Dow Jones futures agenda

Dow Jones, S&P 500 Analysis: Monitor market sentiment closely as uptrends keep up

The chart is created in the trading view

S&P 500 Mood Outlook – Neutral

The IGCS gauge This means that about 32% of retail investors have S&P 500 net lengths. The excessive exposure has increased by 3.65% compared to yesterday, but has also decreased by 3.27% compared to a week ago. The fact that traders still have net opportunities indicates that prices are continuing to rise. However, the combination of this and recent mood swings indicates a neutral outlook for the index.


Dow Jones, S&P 500 Analysis: Monitor market sentiment closely as uptrends keep up

Technical analysis

From a technical point of view, the S&P 500 is neutralDoji‘candlestick pattern. If it appears on an uptrend or downtrend, it may indicate a turning point. But this is not always the case. Confirmation is the key. Further negative closing can secure the Doji by opening the door lower. This would focus on a 20-day SMA and growing support from March 2020. The negative divergence in the RSI also indicates that the upswing is slowing, which may sometimes precede the lower one.

S&P 500 futures daily chart

Dow Jones, S&P 500 Analysis: Monitor market sentiment closely as uptrends keep up

The chart is created in the trading view

* IG customer mood charts and positioning data used from April 27thth Report

– Written by Daniel Dubrovsky Strategist to DailyFX.com

Use the or comments section below to contact Daniel @ddrovrovskyFX Twitter

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