Current trend

The leading index of the American economy, the S&P 500, is adjusting at 5723.0: the prospects for continuing the "dovish" rhetoric of the US Federal Reserve support the recovery of operating activities of companies in the high-tech sector.

This week, Raphael Bostic and Neel Kashkari, members of the Board of the Open Market Operations Committee (FOMC), will speak to journalists and experts: after the reduction of the cost of borrowing by 50 basis points at once, market participants are waiting for comments on the further steps of the financial authorities, assuming that the interest rate may be lowered at least once more – in November by 50 basis points, or in November and December by 25 basis points. The basic forecast of the Chicago Mercantile Exchange (CME Group) instrument FedWatch Tool assumes a correction on November 7 by 50 basis points with a probability of 50.2%.

A small deterrent to the growth of the stock market is now the debt market, which is being adjusted upwards: for example, the leading 10-year US Treasuries rose to 3.759% from 3.626% last week, more conservative 20-year bonds are trading at 4.125%, also above 4.014% last Monday, and global 30-summer bonds showed an increase to 4.083%, the highest since September 3.

Among the growth leaders are: Constellation Energy Corp. ( 22.29%), Nike Inc. ( 6.84%), NRG Energy Inc. ( 6.43%), and Super Micro Computer Inc. ( 4.59%).

Among the leaders of the decline are: FedEx Corporation (˗15.23%), Lennar Corporation (˗5.33%) and Old Dominion Freight Line Inc. (˗5.16%).

Support and resistance

The index quotes are adjusting and move up again on the D1 chart, holding in the ascending channel with the boundaries of 5950.0–5350.0.

Technical indicators are holding the global buy signal, which has begun to strengthen: the fast EMAs on the Alligator indicator are moving away from the signal line, and the AO histogram, being in the purchases zone, forms corrective bars.

Support levels: 5670.0, 5500.0.

Resistance levels: 5750.0, 5920.0.

Trading tips

If the asset continues to grow, as well as the price consolidates above the level at 5750.0, one may open long positions with a target of 5920.0 and a stop-loss of 5700.0. Implementation period: 7 days and more.

If the asset continues to decline and the price consolidates below the support level of 5670.0, one can open short positions with a target of 5500.0 and a stop-loss of 5720.0.