Jump to content

Dow Jones, S&P 500 Forecast: Retail Traders Boost Long Bets Despite Ukraine Tensions

Recommended Posts


  • Retail traders boost long bets on Wall Street amid Ukraine tensions
  • As a contrarian signal, this may hint at Dow Jones, S&P 500 losses
  • Check out this week’s webinar recording for fundamental overview
What Time Does the Stock Market Open and Close? Wall Street Trading Hours

Amid geopolitical tensions in Ukraine, data from IG Client Sentiment (IGCS) shows that retail traders are increasingly betting that the Dow Jones and S&P 500 may rally ahead. Upside exposure has been on the rise. At times, IGCS can behave as a contrarian indicator. If this trend in positioning continues, then the road ahead for Wall Street could be tough. For a more comprehensive overview, check out the recording of my webinar above.


The IGCS gauge shows that about 63% of retail investors are net-long the Dow Jones. Upside exposure has increased by 11.25% and 6.36% compared to yesterday and last week respectively. Since most traders are biased to the upside, this hints that prices may continue falling. This, plus recent shifts in positioning, are offering a stronger bearish contrarian trading bias.

Dow Jones, S&P 500 Forecast: Retail Traders Boost Long Bets Despite Ukraine Tensions


Dow Jones futures appear to be trading within the boundaries of a Falling Wedge chart formation, which could spell weakness in the near term if prices remain within the boundaries of it. The index is consolidating around the 32902 – 33623 support zone after a Hammer candlestick pattern. The latter spells indecision. Further gains could hint at a retest of the wedge’s ceiling, where a bearish Death Cross between the 50- and 200-day Simple Moving Averages seems likely to form. Further losses expose the 31951 – 30803 support zone before March 2021 lows come into focus.


Dow Jones, S&P 500 Forecast: Retail Traders Boost Long Bets Despite Ukraine Tensions

Chart Created in Trading View


The IGCS gauge reveals that about 58% of retail traders are net-long the S&P 500. Upside exposure has increased by 4.01% compared to yesterday but is 2.79% lower versus a week ago. Since most investors are biased to the upside, this hints further weakness may be in store for the index. The combination of that and recent changes in positioning are offering a stronger bearish contrarian trading bias.

Dow Jones, S&P 500 Forecast: Retail Traders Boost Long Bets Despite Ukraine Tensions


S&P 500 futures are also trading within the boundaries of a Falling Wedge chart formation. Key support held as the 4224 – 4258 inflection zone. Further gains would place the focus on the ceiling of the wedge, where a Death Cross between the 50- and 200-day SMAs may form on the horizon, offering key resistance. Further losses would place the focus on the June 21st low at 4126 before the May bottom at 4029 comes into focus. Positive RSI divergence may persist, showing that downside momentum is fading. That can at times precede a turn higher.

Dow Jones, S&P 500 Forecast: Retail Traders Boost Long Bets Despite Ukraine Tensions

Chart Created in Trading View

*IG Client Sentiment Charts and Positioning Data Used from March 1st Report

--- Written by Daniel Dubrovsky, Strategist for DailyFX.com. 3rd March 2022

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
    • Total Posts
    • Total Members
    • Most Online
      10/06/21 10:53

    Newest Member
    Joined 02/10/23 23:07
  • Posts

    • Commodities Market Trading Report - Technical Analysis is Elliott Wave and Trading Strategies Content: US Bond Yields, USD, DXY, US Gold XAU, GDX, Silver XAG, Gold Stocks, Iron Ore, Copper, Uranium, Crude Oil, Natural Gas. Commodities Market Summary: While the USD continues higher, gold and silver will continue to be lower. Copper will continue lower, while Uranium is in a bullish Wave (iv) corrective pattern. Crude Oil is creating five waves down from the high and Natural Gas still hasn’t given a buy signal. Video Chapters 00:00  TLT Bonds. US Gov Bonds 10/5 Yr Yields 07:19 US Dollar Index, DXY 12:02 Precious Metals: Spot Gold  / US Spot Silver / XGD 27:37 Base Metals: XME ETF, Iron Ore, Copper. Uranium URA. 33:35 Energy: XLE ETF / Crude Oil / Natural Gas  41:40 End Analyst Peter Mathers TradingLounge™ Australian Financial Services Licence - AFSL 317817 Source: tradinglounge.com  Access Trial here  
    • I have recently researched cryptocurrency exchange tokens with good potential that would be a profitable investment for the upcoming bull market. This is what I found so far. 1. Binance's token BNB, BNB is the biggest exchange token and has done well over the years. However, its performance this year has not been great and it currently trades at over $200. 2. OKX's token, OKB, is trading at over $40 and has performed very well in 2023. It may be a good addition to our portfolio for the upcoming bull market. 3. Bitget's token, BGB. The BGB daily chart looks fascinating and it currently trades around $0.40. Based on the exchange's growth in 2023, BGB seems to be the most promising exchange token I have researched. I will continue to research other exchange tokens, but for now, I would like to know your thoughts on these tokens.
    • If you have been into cryptocurrency over the time, you'd have noticed it has faced a lot of ups and downs, from several crackdowns to adoptions, ranging from China's ban, to El Salvador's adoption, including Tesla's adoption and others, and it looks as though in an ever developing world of technology, adoption seems to be the resolution for advancing companies and now we have another adoption, Honda Motor Co. Honda Motor Co., a well-known Japanese automaker, has made a surprising decision to accept digital assets as payment for its goods. By collaborating with the blockchain payment platform FCF Pay, Honda now makes it possible for clients to lease or buy their cars and power equipment using different cryptocurrencies, including XRP and the most popular doge token, Shiba Inu (SHIB). This partnership increases the possibilities accessible to customers who may now purchase Honda's cars, motorbikes, and power equipment using digital currencies like Bitcoin (BTC), Ether (ETH), Binance Coin (BNB), Polkadot (DOT), and other well-known cryptocurrencies in addition to XRP and Shiba Inu (SHIB) rather than conventional cash. The unique feature of Honda's offering is that it accepts a variety of more uncommon meme-inspired coins, such as Pepe Coin (PEPE), Floki Inu (FLOKI), Bone ShibaSwap (BONE), and Doge Killer (LEASH). Connecting the dots of various happenings in the crypto space and sudden adoption by various companies and even some economies, where do you see cryptocurrency in the coming years and what steps are you taking in preparation for it?
  • Create New...