Mixed opening on Wall Street is expected with the Nasdaq slightly lower and the SP 500 with clear rises.
1- The nasdaq rose much more than the SP 500 in the worst moments, because it was assumed that various values were not only not harmed but benefited by the crisis. Now that the reopening begins to be discounted, these values no longer benefit and hence the divergence. It’s also hurting Trump’s comment that he would be open to strict regulations against social media values if they don’t have more control. It has been very especially hard on twitter.
2- The SP 500 continues to fight arm in arm against the great resistance presented by the average of 200. It is not far enough away to be sure that it is not breaking it. That level is still key.
Today Goldman has said that if the next strong resistance breaks it would be 3,131 due to the Fibonacci retracement of 76.4% of the entire fall. While underneath you see no danger, as long as you don’t lose the 2900, if you do expect a steep drop. Obviously also if it fails at the height of the average of 200 to that area of 2,900.
It seems correct levels to evaluate the market.
3- The SP 500 is being infected by the strong European rise, which in turn is caused by a European reconstruction plan that has been presented today much stronger than originally thought.- The problem now is that It has to pass and it will not be easy due to the hostility of some governments.
4- As a limiting factor for profits, the trade war between the US and China continues to appear. Contestants have stopped calling it a trade war and are now calling it a financial war. And is that the trade agreement right now is completely wet paper.
During the day they have followed the harsh declarations of one and the other, threatening themselves with all kinds of means, sanctions and retaliation.
5- We must not forget that we are in days of month-end rebalancing of large pension funds. And that this month the rebalancing is for the sale of shares and the purchase of bonds, yesterday in the last few minutes it was already seen enough.
6- Tonight’s increases in Japan also help, thanks to comments that they can put more aid for 1.1 billion dollars on the table.
7- Gold has been going very badly for a few days and today it continues with its declines, while oil futures are down almost 2.5% on suspicions that Russia intends to lift its production cuts from July.
8- The indicators show strong overbought in the US indices, especially in the Russell. Put call ratios also show strong overconfidence.
9- The tourism and aviation sector is rising violently in the pre-opening