AI Infrastructure Sell-Off Hits NASDAQ | NFP & Dow Jones Market Outlook

In today’s GCI Market Outlook, let’s take a look at Forex trading on the EURGBP, GBPUSD, EURAUD, AUDCAD, EURCAD, S&P500, the Dow Jones Industrial Average, and the NASDAQ.

Just a reminder that these videos are intended as educational, we are only observing current market conditions, and these are not to be considered as trading advice.

Lately, we have been talking about the difference between all the major US Indices.

Here we see the Russell 2000 and the Dow Jones steadily rising while the S&P500 has been erratic but looking like it is in recovery mode.

The NASDAQ looked the same, but suddenly investors realised that the AI Infrastructure space - chips, memory, servers, data centres, etc.- is oversupplied.

This caused a sell-off in more NASDAQ-listed companies, so we saw this drop yesterday.

Is it time to buy the dip? Let’s keep an eye on this.

Looking at USD pairs, you will note mostly consolidation, and there are 2 reasons for this.

This weekend is 4 July, so a huge holiday in the US with the markets closed on Friday.

Because of the Friday closure, the US Non-Farm Payroll report will be announced today, and investors, traders and the Fed will be watching carefully.

This consolidation in a strong USD has gold and silver retracing over the last few days, so let’s see if price action returns to the upper trend lines and the downtrend continues.

Keep an eye on your technicals and today’s NFPs.

Prices are very close to returning to pre-war levels, with Brent closer.

Last time we spotted this sudden bullish price action on EURCAD with an overbought stochastic oscillator, look what happened.

The big picture on the 4-hour chart has us anticipating a symmetrical pennant, so we may have some range trading opportunities coming up.

Speaking of range trading, we spotted this a while ago on AUDCAD, and our technicals are still faithfully picking the tops and bottoms.

We see mixed strength and weakness in EUR pairs, and we are watching EURJPY in this pullback to the lower trendline and the stochastic oscillator oversold.

In EURAUD, we see a pullback as well, but into a falling wedge, which is often a bullish sign.

For all the reasons we have discussed over the last few weeks, USD is still the strongest currency overall, but GBP is the best performing over the last couple of weeks.

This is due to UK inflation still being too high and the anticipation that the BoE will not be lowering interest rates.

Also, investors often react when a new government is in the offing.

So, we are watching a few pairs like GBPUSD with a bullish MACD, and we await an oversold stochastic oscillator and price action returning to the lower trend line.

Price action on EURGBP has broken through a year-long zone of support with key levels below and bearish confluence.

That’s all for now.

CFDs and FX are leveraged products, and your capital may be at risk.