Trading the Nasdaq 100 Amidst Big Tech Earnings
Microsoft and Meta notably impressed powering the tech-heavy index higher in the futures market, but it’s two down and two more to go as both Apple and Amazon are next.
Quite a bit on offer over the past 24 hours for market participants, on the central bank front three notable ones where the Bank of Canada held on rates at 2.75% as expected, and so too the Bank of Japan earlier this morning at 0.5%. But for those trading US equities (and a whole lot more), the real interest was on the US Federal Reserve (Fed), its Federal Open Market Committee (FOMC) opting to hold on interest rates at 4.25-4.5% as expected with two (Waller and Bowman) voting for a rate cut, and all eyes on Chairman Powell’s press conference for hints of whether September was the key to a rate cut. A ‘hawkish hold’ best describes the event as he failed to give a hint, saying that their “obligation is to keep longer-term inflation expectations well anchored and to prevent a one-time increase in the price level from becoming an ongoing inflation problem”, and that tariffs have “begun to show through more clearly to prices of some goods, but their overall effects on economic activity and inflation remain to be seen”. Treasury yields finished higher, and market pricing (CME’s FedWatch) reduced rate cut likelihoods for September to a slight majority and so too for a second reduction in December.
It was also busy in terms of economic data, advance Q2 GDP (Gross Domestic Product) at a strong 3% vs 2.5% expectations, doing its part in confirming on the growth front that the Q1 contraction was an exception rather than the rule and allaying any recessionary fears. ADP’s (Automatic Data Processing) non-farm estimate showed growth of 104K and it too besting forecasts, though it hasn’t been as reliant an indicator as of late ahead of the market-moving figure on Friday out of the BLS (Bureau of Labor Statistics). Prior to that, we’ve got the weekly claims today alongside PCE (Personal Consumption Expenditures Index) Price Index for the month of June.
Even busier? Quarterly results from Big Tech, with Microsoft and Meta both impressing and easily beating on both earnings and revenue. Shares of the former surged 8.3% in extended trading and took its market cap above $4tn. There was a better increase in percentage terms for Meta spiking over 11% in after-hours trading as ad sales took the attention, and in all giving market participants plenty to cheer about ahead of earnings from two more heavyweights, Apple and Amazon.
Nasdaq 100’s technical overview, strategies and levels
Looking at the daily time frame, and price is above all its main moving averages, walking the upper Bollinger Band, with a positive DMI (Directional Movement Index) given the sizable margin for the +DI over the -DI, an ADX (Average Directional Movement Index) in trending territory, and an RSI (Relative Strength Index) venturing further into overbought territory. That makes for a bullish technical overview, though adding any caution on pullback should it occur meaning buying off the 1st Support only after a significant reversal instead of a simple one or fading the move. The weekly time frame’s overview is also ‘bull average’, with this week’s weekly 1st Resistance level not far off today’s daily 2nd Resistance making it more noteworthy. But technicals before further important events (PCE price index, Non-Farm Payrolls, trade deadline, and earnings from more of Big Tech) carries less weight especially if price manages to reach key levels just before an event.
Capital.com’s client sentiment for Nasdaq 100
In sentiment, we’ve got ourselves another shift in client bias, from majority long 58% yesterday to a slight sell 53% as longs continue to get enticed into closing out while daring shorts resurface looking to time a top that has yet to reveal itself as the market climbs higher with conviction and powered by what has been stronger earnings on the tech front.
As for CoT (Commitment of Traders report out of the CFTC) speculators, still net long but down a notch falling to 64% according to last Friday’s release on a larger unwind in longs (-9,649) over the reduction in shorts (4,714), but yet to undo what has been a noticeable increase in net long bias among them since June tracking the index higher.
Client sentiment mapped on the daily chart
Source: Capital.com
Period: MAY 2025 – JULY 2025
Past performance is not an indicator of future results.
Nasdaq 100’s chart on Capital.com platform with key technical indicators
Source: Capital.com
Period: JUNE 2025 – JULY 2025
Past performance is not an indicator of future results.
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