The XJO is expected to rally on open this morning following a massive move higher in the U.S overnight which saw their market once again make fresh highs.
Most of the rally was driven by NVDIA, so it is not reasonable to expect the same gains in our market. We should open near 7,650 and we may even go on to test 7,700 today, however U.S futures are mildly in the red so it seems more likely that we hang around our expected on.
With the U.S breaking their ascending triangle higher, our market may have the confidence to follow suit. Though it doesn’t seem likely today, we should see it happen over the next week or so provided there aren’t any major shocks.
US shares closed firmly higher overnight, with each of the three major indices jumping after a better than expected result from NVIDIA. This strong report was enough to drive the NASDAQ higher, but also to drive the SP500 and DOW JONES higher. Ovrnight US economic data also came in pretty strong, with fewer than expected jobless claims, as well as stronger manufacturing PMI, though services PMI was lower than expected. Overall US markets rallied late last year on the prospect of rate cuts this year, but as those prospects have diminished, US shares have found other reasons to rally, including strong tech earnings, expected growth due to AI, and strong bullish technicals.
Ten of the eleven sector groups of the SP500 closed higher overnight, with Technology, Discretionary, and Communications closing firmly higher. Most other sectors closed notably higher, with only Utilities closing lower.
The SP500 broke above its previous all-time high at 5,050 overnight, with the index continuing higher. Its hard to say where this move may stall, because these levels have never been seen before. Overall it looks like the uptrend is continuing for now. Should we see selling from here, the first potential downside target would be potential support at 5,000.
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