Current trend

One of the leading US indices NQ 100 is showing correction dynamics in the area of 19790.0.

The rise in stock indices is supported by the US Federal Reserve's intention to reduce borrowing costs at its next meeting on November 7. As of today, the Chicago Mercantile Exchange (CME Group) FedWatch Tool shows an 86.6% chance of a –25–basis–point adjustment, with a larger 50–basis–point cut not even being considered. Such confidence among analysts may come from forecasts regarding the US inflation data to be published on Thursday: the Consumer Price Index is expected to fall to 2.3% from 2.5%, while the Core CPI excluding Food and Energy may remain at 3.2%, as it was a month earlier.

The corrective growth in the bond market remains a minor restraining factor for the index quotes: thus, the yield rate on 10-year debt securities rose to 4.006% from 3.969% last week, on 20-year ones — to 4.356% from 4.323%, and on 30-year ones — to 4.287%, the highest value since the end of July.

The growth leaders in the index are Super Micro Computer Inc. ( 15.79%), Diamondback Energy Inc. ( 2.51%), Nvidia Corp. ( 2.24%), PayPal Holdings Inc. ( 1.13%).

Among the leaders of the decline are Adobe Systems Inc. (–3.93%), Ross Stores Inc. (–3.75%), Tesla Inc. (–3.70%).

Support and resistance

On the daily chart, the index quotes continue to correct, rising within the channel with boundaries of 20700.0–19300.0.

Technical indicators reversed and issued a signal to start buying: fast EMAs on the Alligator indicator are still moving away from the signal line, and the AO histogram is forming new upward bars, rising in the buy zone.

Support levels: 19590.0, 18750.0.

Resistance levels: 20120.0, 20790.0.

Trading tips

If the asset continues growing and consolidates above 20120.0, long positions with the target at 20790.0 will be relevant. Stop-loss — 20000.0. Implementation time: 7 days and more.

If the asset reverses and declines and the price consolidates below 19590.0, short positions can be opened with the target at 18750.0. Stop-loss — 19800.0.