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Nasdaq 100 Correction before the Meeting of the US Fed

12/6/2022 1:54 PM

The Nasdaq 100 index is showing corrective dynamics, being at 11794.0.

US stock indicators are turning to the downside, and the trend of recent days signals a significant increase in market uncertainty. Next week, on December 14, the last meeting of the US Federal Reserve of the year will take place and, given the recent statements by officials of the regional Federal Reserve Banks (FRB), the regulator is going to slow down the pace of interest rate adjustment. However, the latest data on the labor market confirms the strengthening of the negative dynamics of indicators, and as the Unemployment Rate in the country rises, this may provoke the US financial authorities to continue their "hawkish" policy, which would be a serious blow to the stock market, which is already under pressure.

Meanwhile, the world's leading electric car manufacturer, Tesla Inc., has announced plans to cut car production at its Shanghai plant by 20.0% due to falling demand, which was caused by a decrease in the purchasing power of the population due to rapid global inflation and increased quarantine restrictions in certain areas of China. The day before, plans to relocate production to other Asian countries, in particular, to Vietnam and India, were also announced by Apple Inc.

Additional pressure on the quotes of the indices again began to be exerted by the debt market. The popular 10-year Treasuries are trading at 3.592%, up from the 3.491% hit late last week, while the conservative 20-year ones are trading at 3.825%, up from 3.767% on Friday.

The growth leaders in the index are Baidu Inc (+2.74%), Pinduoduo (+1.69%), Inc. (+0.92%), Activision Blizzard (+0.75%).

Among the leaders of the decline are DocuSign Inc. (-8.93%), Lucid Group Inc. (-7.09%), MercadoLibre Inc. (-6.68%), Tesla Inc. (-6.37%).

On the daily chart of the asset, the index quotes continue to trade above the local sideways channel.

Technical indicators maintain a steady buy signal: fast EMAs on the Alligator indicator are moving away from the signal line, and the AO oscillator histogram is forming new upward bars, being above the transition level.

Support levels: 11500.0, 10700.0. | Resistance levels: 12100.0, 12800.0.

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