Article by IG Senior Market Analyst Axel Rudolph
CAC 40, Nasdaq 100, Russell 2000 Charts and Analysis
CAC 40 tries to shrug off Tuesday’s losses
The French CAC 40 stock index has been trading in a sideways trading range below its mid-December record high at 7,653 and on Tuesday dipped to a near one-month low at 7,482 amid rising yields as excessive rate cut expectations were pared back.
Today the index is trying to regain some lost ground but is encountering resistance around the 13 December 7,520 low. Further minor resistance is seen at last Thursday’s 7,531 low and Friday’s 7,570 high.
Were Tuesday’s 7,482 low to be slipped through, the September peak at 7,436 may be revisited over the coming days.
CAC 40 Daily Chart
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Nasdaq 100 drops for third straight day
The Nasdaq 100’s stiff rally off its late October low has finally run out of steam after nine consecutive weeks of gains with it hitting a record high at 16,978, marginally below the minor psychological 17,000 mark, before falling for three straight days, the most since October.
Sector rotation out of technology into telecoms, energy, banks, and automobiles pushed the Nasdaq 100 lower as well as pared back rate cut expectations and rallying US Treasury yields.
The fall through the October-to-January uptrend line may lead to a slide towards the November high at 16,167 being seen. As long as Tuesday’s three-week low at 16,450 holds, though, the mid-December high at 16,667 may be revisited as well as the breached uptrend line, now because of inverse polarity a resistance line, at 16,746.
Nasdaq 100 Daily Chart
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Russell 2000 slips back to July peak
The Russell 2000 has seen three straight days of losses from its 2,078 December peak, a level last traded in April 2022, amid pared back rate cut expectations and heightened tensions in the Middle East which provoked risk-off sentiment.
The July peak at 2,007 to the psychological 2,000 mark should offer support. If not, the 20 July high at 1,995 might do so.
Resistance above the mid-December high at 2,023 sits at Tuesday’s 2,043 high and at the 20 December intraday peak at 2,046.