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NQ 100 Investors Hope for a Suspension of the Rate Hike Cycle

3/31/2023 12:39 PM

The NQ 100 index is correcting around 13000.0 in anticipation of an end to the US Fed's interest rate hike cycle after the final data on Gross Domestic Product (GDP) for the fourth quarter of 2022 showed a slowdown in the economy from 3.2% to 2.6%.

Statistics indicate that the regulator's "hawkish" course has a negative impact on economic growth, which may cause a revision of monetary policy at the next meeting. Confidence in this is added by the recent situation in the American banking sector, where two fairly large credit institutions, Silicon Valley Bank and Signature Bank, went bankrupt due to the inability to comply with obligations to depositors. To prevent the crisis from developing, the government is preparing a new plan, according to which liquidity and capital requirements for banks with a capitalization of 100.0 billion dollars to 250.0 billion dollars will be tightened, and mandatory stress tests of such organizations will be carried out.

A new period for the publication of financial statements, as well as the next meeting of the US Federal Reserve, will be only in May, therefore, serious fluctuations in the dynamics of the NQ 100 index quotations should not be expected in the near future.

The growth leaders in the index are Inc. (+7.82%), PDD Holdings Inc. (+4.91%), MercadoLibre Inc. (+3.42%), Lam Research Corp. (+3.03%).

Among the leaders of the decline are Paychex Inc. (-2.15%), Lucid Group Inc. (-1.04%), Regeneron Pharmaceutical Inc. (-0.96%), Moderna Inc. (-2.58%).

On the daily chart, the index quotes continue to correct within the Expanding Formation global pattern, holding near the resistance line.

Technical indicators maintain a steady buy signal: the fast Alligator indicator EMAs crossed the signal line from below, and the AO histogram is forming corrective bars in the buy area.

Support levels: 13200.0, 13700.0. | Resistance levels: 12700.0, 11900.0.

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