Can you trade stocks on Labor Day? Dow Jones Outlook Today
Monday, for Labor Day, Wall Street will be closed.
US stock exchanges will be closed on Labor Day. Therefore, no stock transactions.
Additionally, the US Treasuries market will be closed, meaning bond trading will be halted.
The equity futures market will operate on a shortened schedule. Until 1 p.m. ET, trading will take place.
Dow Jones Future: Stock Market Outlook
Last week, the Dow formed an Evening Star in classic fashion, appearing at a critical moment of confluent resistance. In the middle of August, the weekly candle formed a Doji, and the following week, aided by President Powell in Jackson Hole, completely wiped out the gains of the previous two weeks.
This week’s price decline to the 23.6% retracement of this year’s selloff was consistent with the pattern of subsequent evening stars aiming for bearish reversals.
Towards the bottom of the chart, the Dow is likely to experience the most tension; it is the same region that provided support in June. This is close to the 38.2% retracement of the epidemic move and just below the 30,000 level.
NASDAQ 100: Stock market forecasts
The 61.8% retracement of the rebound move provided support for the Nasdaq this week, just as it had for the S&P 500 a few days earlier, but with a bit more volatility. Support rebounded into the 50% mark of that same significant move after Thursday’s level test, which failed to allow a four-hour body to close.
After the NFP-fueled comeback, buyers were unable to sustain a move above the 50% retracement of the short-term move, which is also around the 23.6% retracement of the 2022 selloff. This resistance level will likely be significant next week and may even invalidate short-term bearish themes.
Looking at the Nasdaq over a longer time frame, the weekly chart shows that market sentiment has moved away from its positive rebound of the past two months. There were no noticeable changes in the weekly candles from what was printed in April and May. What I said at the beginning of the article further supports the case for a stronger bearish push.
For this strategy, the 11,300 mark is still quite significant. In June, when a selloff began to find support before eventually turning into a two-month comeback, prices held above the 50% retracement of the significant 2019-21 rally.
A second test or series of tests at this level may not generate the same excitement, and a break below this price could signal the start of a larger downward price correction. Notably, the psychological barrier at 10,000 coincides with the 61.8% Fibonacci retracement of this significant trend.
S&P 500: Stock market outlook
On Thursday, the index found stability at a pivotal level, slightly above 3900. Specifically, around 3915 and 3902, the 23.6% and 61.8% retracement levels of the 2022 decline and the subsequent recovery, respectively, were found (from the June low to the August high). You can also locate a trendline projection in the vicinity by joining the June and July lows.
This zone was only in action a few hours after I mentioned it in my S&P 500 forecast ahead of nonfarm payrolls on Thursday.
After some bullish price activity following the NFP announcement, the rebound it caused was quite intense as soon as the market opened on Friday. However, the buyer’s inability to break through the psychological barrier of $4,000 and the recent price move at $40.16 has triggered a new round of selling pressure.
This sets up a potential test at the confluence of support over the next week. If 3900 is broken, we could see a retest of the lows seen in June. A previous price move at 3820 and a Fibonacci level at 3786 could provide support along the way.