The S&P 500 and Nasdaq Composite ended with gains on last Friday, but still posted a loss for the week as recession fears continue to weigh on investors. Sentiment has been dampened by worries over the future of interest rate hikes by the Federal Reserve. Economic data released through the week pointed to a still robust economy and tight labor market that is only now beginning to show some signs of cooling due to the central bank's aggressive rate hikes.
The holiday-shortened week ahead will be light on earnings reports and corporate events as the calendar winds down in 2022. History is on the side of a Santa Clause rally with the stock market historically seeing more gains than losses during the last trading week. Market indexes have been prone to get pushed higher during the low-volume week as tax-loss strategies and year-end investing tips the scale to the bull side. However, the Santa Claus rally precedent could be tested this year with recession and interest rates fears high. Also in the mix, investors are also uncertain how to interpret economic releases in the environment.
Chart: QQQ daily
Chart: SPX daily
From the tech side of analysis, both QQQ and SPX are right positioned above prior support and gave an intraday Doji on the daily chart.
Chart: SPX 15 mins
In addition, I personally don't think this 15 mins resistance will cause big troubles for SPX and for Qs. There are more buys to come if markets drop below 3800 level, therefore, I think the Santa Claus rally will come eventually.
The holiday-shortened week ahead will be light on earnings reports and corporate events as the calendar winds down in 2022. History is on the side of a Santa Clause rally with the stock market historically seeing more gains than losses during the last trading week. Market indexes have been prone to get pushed higher during the low-volume week as tax-loss strategies and year-end investing tips the scale to the bull side. However, the Santa Claus rally precedent could be tested this year with recession and interest rates fears high. Also in the mix, investors are also uncertain how to interpret economic releases in the environment.
From the tech side of analysis, both QQQ and SPX are right positioned above prior support and gave an intraday Doji on the daily chart.
In addition, I personally don't think this 15 mins resistance will cause big troubles for SPX and for Qs. There are more buys to come if markets drop below 3800 level, therefore, I think the Santa Claus rally will come eventually.