Dow Jones, Nasdaq, S&P 500 weekly preview: Testing key resistance

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Dow Jones, Nasdaq, S&P 500 weekly preview: Testing key resistance

S&P 500 (SPX) recorded the fourth consecutive weekly close last week, ultimately closing at the highest level since July. It also marks the longest weekly run since June.

The benchmark U.S. stock market index is now testing key resistance near 4560, which is shaped by the trend line that connects the record high and 2023 high.

Similarly, the Dow Jones Industrial Average (DJI) added 1.3% to also hit the downward trend line that connects recent swing highs. On the other hand, the Nasdaq Composite Index (IXIC) rose 0.9% but still managed to secure a weekly close above the key trendline, which will now provide support if the pullback occurs.

Looking forward to this week, the Consumer Confidence report is out on Tuesday. On Wednesday, the Q3 GDP reading is expected to be released. A set of inflation-focused data is set to be out on Thursday, including personal income data for October. Manufacturing PMI and ISM manufacturing data is scheduled for Friday.

Fed’s speakers, including Governor Waller and Presidents Goolsbee and Mester, are all scheduled to speak this week.

On the earnings front, the most notable reporters include Zscaler (NASDAQ: ZS ), Intuit (NASDAQ: INTU ), Workday (NASDAQ: WDAY ), Crowdstrike (CRWD), Salesforce (NYSE: CRM ), and Snowflake (NYSE: SNOW ).

The list also includes Dollar Tree (NASDAQ: DLTR ), Dell Technologies (NYSE: DELL ), Marvel (MRVL), Kroger (NYSE: KR ), Ulta Beauty (NASDAQ: ULTA ), and UiPath (NYSE: PATH ).

What analysts are saying about US stocks

Analysts at Oppenheimer: “Our feel is that bearish investors that largely missed S&P 500 gains in 2023 are gravitating towards the Russell 2000 in belief there’s greater potential in lagging benchmarks—we disagree. We maintain our preference for the S&P 500 given its weighting to Technology.”

Analysts at BofA: “We expect CTA buying in the S&P 500 [this] week as the index has gained greater than 1% in each of the last four weeks turning its trend strength positive for the first time since early October. Our model initiated a long position [the] past week that will rapidly increase along any price path [this] week.”

Analysts at Citi: “More S&P 500 companies are expected to positively contribute to index-level growth, fewer are projected to be significant detractors, and underlying EPS growth variation is set to decline… Ultimately, it supports our view that S&P 500 EPS can turn higher even as macro concerns linger.”

Analysts at BTIG: “The Short-term Volatility Index (VIX9D) closed below 10 last week, the lowest reading since Jan. 2020. Volatility is a funny thing because it is often mean reverting, unless we are in a new regime… While we continue to expect some rotation into laggards, we don't think we are in a new regime and therefore as we head into December, a sub-13 VIX is likely a yellow light.”

Analysts at Roth MKM: “As we enter the last few trading days of November, we find the S&P 500 could put in its best monthly gains of the year. Seasonal tailwinds often blow into December. The question becomes, can the indices hold their ground into year-end… We found when discretionary experienced an extremely strong November, similar to this month, positive returns were likely to follow in December.”

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