NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Soars 4% As U.S. And China Temporarily Lower Tariffs

SP500

SP500 rallied as traders focused on successful trade talks between the U.S. and China. Both countries agreed to reduce tariffs to the previous levels. As a result, China will have an 10% tariff on most U.S. imports, while U.S. will charge 30%. The countries will have 90 days to negotiate a comprehensive deal. Put simply, the negotiations have stopped the trade war between the world’s biggest economies. Not surprisingly, traders rushed to buy stocks. The rally was broad, and most market sectors gained ground in today’s trading session. Consumer defensive and utilities stocks pulled back as demand for safe-haven assets declined. Treasury yields rallied, but this move did not put any pressure on stocks.

Currently, SP500 is trying to stay above the resistance level at 5800 – 5810. In case this attempt is successful, SP500 will move towards the next resistance at 5910 – 5920. It should be noted that RSI is in the overbought territory, so the risks of a pullback are increasing.

NASDAQ

NASDAQ gained strong upside momentum as traders reacted to tariff news. Chip stocks, which are sensitive to U.S. – China relations, were among the biggest gainers in the NASDAQ index today.

The nearest resistance level for NASDAQ is located in the 20,950 – 21,000 range. If NASDAQ climbs above the 21,000 level, it will head towards the next resistance at 21,450 – 21,500.

Dow Jones

Dow Jones tested new highs amid broad rally in the equity markets. Amazon, which was up by 7.7%, was the biggest gainer in the Dow Jones index today. Lower tariffs on China provide significant support to the company’s business.

If Dow Jones climbs above the 42,400 level, it will move towards the next resistance level, which is located in the 42,700 – 42,800 range.

For a look at all of today’s economic events, check out our economic calendar.