Publication date: Oct. 3, 2024
Price movement AEX Index
It is Thursday, Oct. 3, and the AEX is at 910 in the morning session. That is 5 points (0.55%) lower than last week's reading. Above, you will find the chart of the AEX as of January 1, 2024. You can see the most likely scenario, as we have been reporting for several weeks.
The AEX is awaiting the monthly labor figures from the US. These will be published at 2:30 p.m. on Friday. Until then, the AEX has fluctuated somewhat adrift between 920 and 905. The high came from the rise of Shell, which is up 3.5% this week. This is because of the increase in oil prices of about 4% due to the situation in the Middle East. So on Thursday, the AEX is heading lower again at 910.
What does this mean for sentiment?
Sentiment in stock markets can be characterized as "anxious". This is reflected in the ever-rising price of gold, the traditional haven in turbulent times. The situation in the Middle East has, of course, been tense for decades, but currently, people are watching developments with anxious eyes. The likelihood of serious escalation is increasing. This, of course, is also directly reflected in the price of oil.
The Fed has already cut interest rates significantly and again indicated that it plans to cut rates further in the coming year. However, the speed is fully contingent on the forthcoming data, and if they will proceed at a deliberate pace. So this may cause a slowdown. As long as inflation stays under control and the interest rate cut does its job causing the labor market in the US to pick up, this policy will work out well for the stock markets. But the bar is high! A slight setback will immediately provide additional food for the fearful sentiment.
What is the expectation for the price movement of the AEX Index?
The algorithm has a running short signal for the AEX from 885. Price target 820 and stop loss at 930.
The most likely scenario is that the AEX has completed the recovery in the 920-925 zone. Then the larger correction will be completed by a fall to the 820 level.
This fall may be triggered as soon as a slightly disappointing macroeconomic figure comes out or if the situation in the Middle East deteriorates significantly. Then we can expect another moment of panic selling.
The major trend remains up and the indicated decline is a healthy correction and provides perfect opportunities to buy shares for the longer term. AEX price target remains 1025 points.
Look back: read our view of the September 26, 2024 AEX here
Price movement of the Nasdaq
The Nasdaq futures are currently at 19.915 which is 535 points (2.6%) lower than last week's position.
The Nasdaq futures are correcting this week from the sharp rise of the past few weeks and continue to move volatile around the well-known 20,000 points. The futures are moving between 20,300 and 19,800 and, of course, are also awaiting the important numbers on Friday at 2:30 p.m.
What is the expectation for the Nasdaq's price performance?
The Nasdaq has been showing a lot of strength for some time. The expectation is that the Nasdaq futures can still correct to around 19,500 in the near term and then find the strength again to continue rising to the 21,000 level. We expect some movement in the Nasdaq in the coming week due to increased fearful sentiment. However, the Nasdaq continues to show a lot of resilience and is expected to benefit well from the interest rate cuts ahead.
For the long term, the technical trend is up and the price target is at least 21,900.
The algorithm has given a buy signal for the Nasdaq based on this scenario. The stop loss is at 19,300 and the price target is, of course, 21,900.
Important items on the economic calendar for the week of Oct. 7 through Oct. 11:
In the coming week, everything revolves around the US monthly and annual Consumer Price Index (CPI), which will be released at 2:30 p.m. on Thursday. The CPI is an important inflation figure and will provide much-needed movement in financial markets and possibly set the direction for the period ahead.
Disclaimer: Investing involves risk. Our analysts are not financial advisors. Always consult an advisor when making financial decisions. The information and tips provided on this website are based on our analysts' own insights and experiences. They are therefore for educational purposes only
