US stock market analysis (May 16, 2023)

Create at 3 weeks ago (May 16, 2023 10:19)

US stock markets remain stable amid a slowing economy

The S&P 500 and DJIA closed in slightly positive territory on Monday, while the Treasury yield rose amid concerns about debt ceiling negotiations and the rebound of commercial banking stocks after heavy losses last week amid US manufacturing data reflecting a slowing US economy and cooling inflation, while Meta's rally supports the Nasdaq.

On Tuesday, a progress report on the debt ceiling talks will be discussed. It has sparked expectations that US lawmakers will achieve an agreement to contribute an extra $31.4 trillion to the federal budget and avoid a payment default. Although the US Treasury reiterated on Monday that the US government will be able to pay off its debt until June 1 if the debt limit is not raised and federal spending is limited, this has increased pressure on Republican congressmen and the White House to reach an agreement in the coming days.

Concerns about moderate inflation drove up the yield on the US Treasury once more. Meanwhile, tighter lending restrictions are likely to help the Fed control economic growth and combat inflation. Although equities in the technology sector rise as semiconductor stocks climb, concerns in the banking sector cannot be alleviated. After four weeks of growth, the volume of US commercial bank deposits declined for the second week in a row, as did lending volumes.

Meanwhile, the Empire State Manufacturing Index, a measure of manufacturing activity in New York State, fell to -31.8 in May, a larger-than-expected reduction of -3.75, indicating a prolonged downturn in manufacturing activity as the company's first-quarter results report in the United States comes to a close. Investors will pay close attention to retailer data on income trends and customer behavior after this season's performance was much better than projected.

Furthermore, this week's US economic data includes retail sales, weekly jobless claims, and housing data, which tend to slow and may enhance predictions that the Fed will temporarily stop raising interest rates. Although some Fed officials stated on Monday that interest rates may remain high, contrary to market expectations of a rate decrease before the end of the year.

Data for Technical Analysis (5H) CFD US30 DJIA

Resistance : 33388.6, 33426.5, 33487.7

Support : 33266.2, 33228.3, 33167.1                             

5H Outlook

US stock market analysis Source:               

Buy/Long 1 If the support at the price range 33216.2 - 33266.2 is touched, but the support at 33266.2 cannot be broken, the TP may be set around 33400.0 and the SL around 33196.0, or up to the risk appetite.

Buy/Long 2 If the resistance can be broken at the price range of 33388.6 - 33438.6, TP may be set around 33500.0 and SL around 33236.0, or up to the risk appetite.       

Sell/Short 1 If the resistance at the price range 33388.6 - 33438.6 is touched, but the resistance at 33388.6 cannot be broken, the TP may be set around 33260.0 and the SL around 33458.0, or up to the risk appetite.

Sell/Short 2 If the support can be broken at the price range of 33216.2 - 33266.2, TP may be set around 33145.0 and SL around 33418.0, or up to the risk appetite.       

Pivot Points May 16, 2023 02:51AM GMT

Name S3 S2 S1 Pivot Points R1 R2 R3
Classic 33091.8 33167.1 33252.1 33327.4 33412.4 33487.7 33572.7
Fibonacci 33167.1 33228.3 33266.2 33327.4 33388.6 33426.5 33487.7
Camarilla 33292.9 33307.6 33322.3 33327.4 33351.7 33366.4 33381.1
Woodie's 33096.6 33169.5 33256.9 33329.8 33417.2 33490.1 33577.5
DeMark's - - 33209.6 33306.1 33369.9 - -

Sources: Investing 1Investing 2

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