As European traders return from their extended Easter break they turn on their screens to find US assets back under pressure. The US 100 index dropped 2.2% yesterday to close at 17779, which included a late rally from a mid session low at 17570.
These moves are potentially reflecting a growing unease around numerous important issues, including, a lack of progress in trade talks with US allies, US economic growth concerns and President Trump's on-going challenge to Federal Reserve independence.
Looking forward, US 100 traders have a lot to focus on this week, Tesla reports its earnings after the close tonight, against a backdrop of weekend news reports which suggested it may be about to delay production of cheaper EVs. That aside, investors may also be focused on sales projections for 2025, autonomous driving plans and the impact of tariffs on the company's profitability.
It may well be a similar story when Alphabet reports its earnings after the close on Thursday.
Throw in the latest April Preliminary PMI Survey releases on Wednesday from the developed economies, which could well start to show the impact of tariffs on growth, business sentiment and inflation, and it is possible that the recent US 100 index volatility could continue across the week.
Technical Update: Could Potential Support at 17404/17749 Be Important?
As impressive as the 18% recovery in the US 100 index from the April 7th 2025 low to the April 10th 2025 high (16290 up to 19222) appeared, after the latest price weakness, this upside may prove to be a limited reactive move, although further confirmation may still be required.
As the chart above shows, the latest upside strength saw the index back to what some traders may have viewed as an important resistance, marked by a combination of the declining Bollinger mid-average (18992 at the time) and the 50% Fibonacci retracement of the February 18th 2025 to April 7th 2025 weakness, which stands at 19258.
With the latest price activity seeing weakness materialise again, it might now be suggested
this potential resistance range remains the important focus on the topside, although much will depend on future market sentiment and price trends.
With this in mind, what are the potential supports we might wish to monitor, to help us gauge how much further the current weakness may have to carry?
Possible Support Levels:
Fibonacci retracements can offer an insight into potential support zones, with them possibly able to hold, even reverse price weakness back to the upside. Therefore, 17404/17749, which is equal to the 50% and 61.8% Fibonacci retracements of the April price strength, maybe an area traders are currently focusing on.
However, there could still be potential for a further period of price weakness if this 17404/17749 range is broken on a closing basis. In that case, the next support may well then be represented by the April 7th 2025 session low at 16290, possibly further, if this in turn gives way.
Possible Resistance Levels:
The 17404/17749 support range is still intact, and while this remains the case on a closing basis, attempts at price strength could still be seen. However, with the declining Bollinger mid-average currently at 18648 and having recently seen it reverse attempts at price strength, closing breaks above this level might be required to trigger a more extended phase of strength.
That said, as proved the case in early April, 19258, the 50% Fibonacci retracement level, may also now need to give way on a closing basis, to suggest further attempts to develop price strength towards higher resistance levels.
The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
These moves are potentially reflecting a growing unease around numerous important issues, including, a lack of progress in trade talks with US allies, US economic growth concerns and President Trump's on-going challenge to Federal Reserve independence.
Looking forward, US 100 traders have a lot to focus on this week, Tesla reports its earnings after the close tonight, against a backdrop of weekend news reports which suggested it may be about to delay production of cheaper EVs. That aside, investors may also be focused on sales projections for 2025, autonomous driving plans and the impact of tariffs on the company's profitability.
It may well be a similar story when Alphabet reports its earnings after the close on Thursday.
Throw in the latest April Preliminary PMI Survey releases on Wednesday from the developed economies, which could well start to show the impact of tariffs on growth, business sentiment and inflation, and it is possible that the recent US 100 index volatility could continue across the week.
Technical Update: Could Potential Support at 17404/17749 Be Important?
As impressive as the 18% recovery in the US 100 index from the April 7th 2025 low to the April 10th 2025 high (16290 up to 19222) appeared, after the latest price weakness, this upside may prove to be a limited reactive move, although further confirmation may still be required.
As the chart above shows, the latest upside strength saw the index back to what some traders may have viewed as an important resistance, marked by a combination of the declining Bollinger mid-average (18992 at the time) and the 50% Fibonacci retracement of the February 18th 2025 to April 7th 2025 weakness, which stands at 19258.
With the latest price activity seeing weakness materialise again, it might now be suggested
this potential resistance range remains the important focus on the topside, although much will depend on future market sentiment and price trends.
With this in mind, what are the potential supports we might wish to monitor, to help us gauge how much further the current weakness may have to carry?
Possible Support Levels:
Fibonacci retracements can offer an insight into potential support zones, with them possibly able to hold, even reverse price weakness back to the upside. Therefore, 17404/17749, which is equal to the 50% and 61.8% Fibonacci retracements of the April price strength, maybe an area traders are currently focusing on.
However, there could still be potential for a further period of price weakness if this 17404/17749 range is broken on a closing basis. In that case, the next support may well then be represented by the April 7th 2025 session low at 16290, possibly further, if this in turn gives way.
Possible Resistance Levels:
The 17404/17749 support range is still intact, and while this remains the case on a closing basis, attempts at price strength could still be seen. However, with the declining Bollinger mid-average currently at 18648 and having recently seen it reverse attempts at price strength, closing breaks above this level might be required to trigger a more extended phase of strength.
That said, as proved the case in early April, 19258, the 50% Fibonacci retracement level, may also now need to give way on a closing basis, to suggest further attempts to develop price strength towards higher resistance levels.
The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Global risk Warning CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading in CFDs. You should consider whether you understand how CFD
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Global risk Warning CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading in CFDs. You should consider whether you understand how CFD
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.