NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Soars As Middle East Ceasefire Begins

According to ceasefire terms, the Strait of Hormuz should be reopened. However, Iran claims that the Strait remains closed as Israel continues its military operation against Hezbollah in Lebanon. At this point, global markets ignore this issue and bet on successful negotiations.

Today, traders also focused on FOMC Minutes. The Minutes indicated that Fed saw risks of rising inflation due to conflict in the Middle East. FOMC Minutes also showed that Fed was ready to raise rates in case the war in Iran led to a longer-term increase in inflation. Fed worries that inflation will stay above the 2% target for longer. Overall, the Minutes were hawkish, which is not surprising as Fed had to make decisions amid geopolitical uncertainty.

The rally was broad, and most market sectors gained strong upside momentum in today’s trading session. Basic materials stocks were among the biggest gainers as traders reacted to the rally in precious metals markets. Industrials and Consumer Cyclical stocks have also gained solid momentum.

Not surprisingly, energy stocks were the only losers today. The strong sell-off in the oil markets put significant pressure on the energy sector.

Currently, SP500 is trying to stay above the resistance level at 6760 – 6770. In case this attempt is successful, SP500 will head towards the 6800 level. A move above 6800 will open the way to the test of the resistance at 6850 – 6860. RSI is in the overbought territory, but there is enough room to gain momentum in the near term.

On the support side, a move below the 6760 level will push SP500 towards the 6700 level. In case SP500 settles back below 6700, it will move towards the support level at 6640 – 6650.