Outlook on gold and the Nasdaq 100:
- gold prices Made on Monday, powered by U.S. dollar Weakness and decline in Treasury yields
- Meanwhile, the Nasdaq 100 fell on cautious market sentiment ahead of major corporate earnings, with Microsoft and Alphabet reporting quarterly results on Tuesday.
- This article looks at the key technical levels to watch in the NASDAQ 100 in the coming days
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Gold prices (XAU/USD) rose slightly at the start of the week, supported by a weaker US dollar and lower Treasury yields, but gains were limited as traders continued to worry about the Fed’s policy outlook, with Wall Street forecasts in a flurry in recent days. . Against this backdrop, XAU/USD rose 0.3% to $1,995 in the New York afternoon, although it was unable to recoup most of last Friday’s losses, when hawkish comments from central bank officials led to a sharp sell-off in the precious metal.
While gold has broken below the $2,000 threshold and has fallen more than 3% from its April high, it is maintaining its bullish profile over the medium term. With the US economy slowing and major market indicators flashing recession signalsIt’s only a matter of time before the FOMC officially ends its tightening campaign. Once this happens, prices are likely to start falling more quickly as traders try to manage the easing cycle in advance. This should create a benign environment for the precious metal.
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Elsewhere, the Nasdaq 100 took a bearish turn on Monday after a near-flat performance on Friday, falling more than 0.7% in early afternoon trading amid cautious sentiment ahead of earnings from major companies. With several large tech giants expected to announce their quarterly results this week, including Microsoft and Alphabet on Tuesday, many traders are waiting to analyze their reports before allocating additional capital to risk assets.
The Nasdaq 100 is up more than 20% from its January lows, so a lot of good news is already reflected in the price. This means earnings from big tech will have to surprise higher by a wide margin to reignite bullish momentum and keep the rally going; Otherwise, the bulls could start bailing out in large numbers, setting the stage for a significant pullback in the near term.
Focusing on Alphabet and Microsoft, the former is seen to report earnings per share of $1.08 on revenue of $68.87 billion while the second is expected to report earnings of $2.24 on sales of $51.12 billion. For a full list of upcoming company reports, check out DailyFX’s new earnings schedule.
source: DailyFX earnings calendar
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NASDAQ 100 Technical Outlook
From a price action perspective, the Nasdaq 100 entered a bull market earlier this month after surging more than 20% from its 2023 lows. While this development is positive in itself, caution is warranted as prices have been forming a double top pattern. Recently bearish, which is an ominous sign for the technology indicator.
If the double top is validated, the Nasdaq 100 could be in a sharp decline, with the possibility of retesting the 12500 level. Regarding the technical signs to watch, the bearish formation will be confirmed with a break below the support level at 12835.
On the other hand, if the technology index moves higher and resumes its advance, the initial resistance will come in at 13200. A move above this barrier will invalidate the double top, paving the way for a rise towards 13610, which is 50% of the Fibonacci retracement of the November 2021 sell-off. October 2022.