Jump to content

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


Recommended Posts

DOW JONES, S&P 500, TECHNICAL ANALYSIS, RETAIL TRADER POSITIONING - TALKING POINTS

  • 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.

DOW JONES SENTIMENT OUTLOOK - BEARISH

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 DAILY CHART

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

S&P 500 SENTIMENT OUTLOOK - BEARISH

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 DAILY CHART

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
  • image.png

  • Posts

    • Bitcoin has been on a brilliant surge, reaching a new ATH of around $89,864. Although the price might have slumped slightly since then, it still has a thrilling 30% surge over the past seven days and 102% surge in 2024, while expectations are rife that its price could rise significantly higher before the end of 2024. Historically, whenever the world’s biggest cryptocurrency is on a tear as this, the market comes alive. While this has also applied in this current surge, memecoin enthusiasts will be keen to witness exponential pump orchestrated by the Bitcoin’s happy mood. For a good part of the year, memecoins have garnered the most attention particularly within Solana and Ton ecosystems, if memecoin market will witness a major rally, then these ecosystems will surely be on the forefront. With this likelihood, all eyes seems to be fixated on PNUT, a meme token on Solana Blockchain. The token pays homage to Late PNUT, a social media sensation squirrel rescued in 2017 by Mark Longo after its mother was killed by a car in New York City. Backed by Beeple, Elon Musk, Doge, Wif, and Justin Sun; PNUT successfully launched on Bitget where its volume is on the rise.  Bitcoin soars, could PNUT and other meme gaints respond accordingly?
    • Tron (TRX) has been showing impressive growth lately. Currently trading between $0.16 and $0.17 as per Coinpedia Markets, the price has increased by nearly 32% over the past six months. This steady upward movement is backed by bullish technical indicators, including a Relative Strength Index (RSI) above 50 and a positive MACD. These signals suggest that TRX could continue to rise, especially if it breaks through its nearest resistance at $0.17. If that happens, TRX Price may reach the next level of $0.18, offering a potential gain of about 6%. Support Levels and Stability Support levels for TRX are currently at $0.16 and $0.15, providing some downside protection. Both the 10-day and 100-day simple moving averages at $0.16 indicate that TRX has maintained price stability in recent weeks. Although the price has shown moderate changes, with a 0.15% increase over the past week and a 3.52% rise over the last month, the overall trend remains positive. Rounding-Bottom Reversal and Fibonacci Levels Tron Coin is also forming a rounding-bottom reversal pattern, currently testing the 38.20% Fibonacci level at $0.1686. This technical setup could signal a bullish breakout if TRX manages to break above this key level. The broader price action also shows a rising wedge pattern, which increases the chances of a successful breakout as the market recovers. Network Growth Supports Tron Crypto Price On the network front, Tron has seen impressive growth. TronScan reports that the total value locked (TVL) on the network has surpassed $18 billion, with daily transactions nearing 9 million. The number of accounts has also grown significantly, reaching 271.38 million. This positive network activity supports a strong Tron Price Prediction as demand for Tron Crypto continues to rise. With increasing momentum and network growth, TRX Crypto seems poised for further gains.
    • GX URA Elliott Wave Analysis The Global X Uranium ETF (GX URA) provides investors exposure to the uranium sector, tracking companies engaged in uranium mining, exploration, and production globally. As nuclear energy gains traction as a cleaner power source, uranium demand could rise, positioning the GX URA ETF as an appealing opportunity for investors interested in the sector's potential growth. The GX URA ETF remains bullish from March 2020 making higher highs and higher lows. The previous was formed in May 2024 and the price already breached in October after a 10-week pullback from May 2024. Daily Chart Analysis Following this low, the ETF completed an impulsive wave A (circled) of the primary degree by November 2021, marking the first phase of a larger corrective structure. A corrective pullback was then developed for wave B (circled) and ended in July 2022. From there, an impulsive wave structure took shape for wave (1) of C (circled), culminating in May 2024. A pullback followed, forming wave (2) as shown on the daily chart. Currently, the rally that began on August 5, 2024, is likely the start of wave 1 of (3), signaling the next phase of the bullish recovery. With wave 1 still developing, significant upside potential remains as the correction unfolds. H4 Chart Analysis H4 chart analysis shows wave 1 of (3) is still developing. Currently, the price has completed wave ((iv)) of 1 and still favors further rallies in wave ((v)) of 1 toward $35 before a larger pullback in wave 2. Technical Analyst : Sanmi Adeagbo Source : Tradinglounge.com get trial here!  
×
×
  • Create New...
us