US stocks hit a record high on Friday, driven by strong performance in artificial intelligence companies like Nvidia. However, caution is warranted as the Nasdaq shows signs of losing upward momentum, with daily and weekly RSI indicating divergence.
This week, markets will be closely watching inflation data, including euro zone consumer confidence, business activity, and February's consumer price index. In the US, January's personal consumption expenditures (PCE) prices are expected to rise by 0.4%, with a potential risk of 0.5% month-over-month.
The divergence in the Nasdaq serves as a warning signal, prompting us to consider tightening stops on market positions. It's crucial to note that in an upward trend, we expect to see higher reaction highs and lows. While the last reaction low was at 17319, significant support rests at 16969, the high from December.