Trade Ideas

A potential Democratic sweep of Congress is adding to the AI trade's headaches, with Nasdaq 100 futures breaking below a major technical level. The implications for the dollar could be significant.

DXY is testing pivotal support, with the weekly range breakout likely to determine the next major leg of the trend as key event risk unfolds.

The Nasdaq 100 was finding some support at 28,000 after recent sell-off amid concerns about the AI trade. Even with oscillators oversold, the risk to the near-term forecast is tilted to the downside.

Silver is testing key support at $49 to $50, the area of its 2011 high, and has yet to bounce. A bullish reversal candlestick would make the picture more constructive, but for now the near-term forecast hangs in the balance.

Gold has started the first week of the new month trying to recover some ground after another bruising week. Oil prices have taken a sharp drop and that has allowed risk assets to bounce back, which has clearly helped the precious metal too. However, with sentiment remaining bearish towards the metals, and with $4000 level having been taken out last week, the path of least resistance is to the downside for gold.

The GBP/USD heads into a crowded week of event risk, with the midterm elections, a Bank of England rate decision and Friday's non-farm payrolls report all capable of moving markets sharply. The greenback remains fundamentally well supported by a hawkish Federal Reserve, but much of that is already priced in, while the renewed sell-off in technology stocks has exposed its vulnerability.

The Nasdaq 100 has printed a bearish monthly key reversal after a brutal October, with weak market breadth and heavy losses among AI beneficiaries raising the risk of further downside.

While the energy shock is a major heading for the euro, the single currency remains supported by a hawkish European Central Bank while growth data in the Eurozone has also been surprisingly resilient. Meanwhile, the dollar faces some near-term positioning risks as markets look ahead to the US midterm elections and given the renewed weakness in technology stocks.

After a three-day recovery, gold prices have fallen in excess of 1.2% so far today, as the metal continues to hover around the $4,000 level. Today’s bearish price action threatens this key level, especially when you consider last week’s 4% sell-off. For now, gold is hanging around this psychological threshold, but it remains to be seen whether it will hold for too long.

Disappointing results from a couple of major global technology names have put the AI trade back under scrutiny, with Nasdaq 100 futures falling around 1% after giving up the post-FOMC gains seen overnight. For now, our short-term Nasdaq 100 forecast remains more on the cautious side of things than outright bearish. The index remains close to its record highs and continues to find dip buyers. But could that change soon?

The DAX is finding some relief from the recent improvement in risk appetite, with investors becoming less concerned about the sustainability of the AI trade