Services PMI and ADP beats fuel US stock market return

The start of the trading day can carry the ghosts of the previous sessions, and today certainly had the potential for a chill.

However, after recent fears that the US economic picture couldn't get much better—especially with tariffs biting and a prior softening in the labor market—the mood shifted abruptly thanks to a more positive wave of data.

Sentiment turned postive mid-morning after we got a surprising lift in US activity:

The morning session offered a beat on the employment front as the ADP Non-Farm Employment Change clocked in at 42K, largely surpassing the 25K forecast.

This rebound in private sector hiring helped dispel fears about a degrading US labor picture, amid a still ongoing lack of public BLS data.

Shortly after, US Services PMI surged to 52.4, comfortably beating the 50.8 expectations and signaling the strongest growth for the service sector since February.

These positive surprises fueled a widespread rebound in risk-assets, with all major US indices turning positive in Wednesday trading.

This morning's strong recovery saw indices dip-buying as the S&P 500 fills its gap.

Let's have a look at intraday charts for the Dow Jones, Nasdaq and S&P 500 to see where price action stands after recent volatile swings.

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The Dow posted a strong bullish candle during the morning session, bringing momentum right above neutral for the industrial index.

With the rally being stronger in tech than consumer defensive, some profit-taking happened at the 4H MA 50 which is the daily resistance that bulls will want to break

A triangle formation is also forming after the past week's correction and the most recent support, a technical pattern to watch to look out for in upcoming trading.

Dow Jones technical levels of interest:

Resistance Levels

• Current All-time high 48,090
• 4H MA 50 and resistance at 47,500
• ATH Resistance Zone 47,900 to 48,100
• post-FOMC highs resistance zone around 46,400 (immediately testing)

Support Levels

• Short timeframe pivot 47,000 to 47,200
• 46,400 major support
• 46,000 higher timeframe Pivot now support
• 45,000 psychological level
• 44,400 to 44,500

Despite the brutal past week correction from its all-time highs, the tech-heavy index remains well within its May 2025 upward channel.

Up above 1.50% since yesterday's close, bulls really enjoyed the news on the Services PMI, prone to tech overperformance.

Nonetheless, buyers will have to maintain momentum (RSI right at neutral) towards the close and will have to breach the MA 50 to retake new all-time highs.

Nasdaq technical levels of interest:

Resistance Levels

• Current ATH 26,283
• All-time high resistance zone 26,100 to 26,300
• immediate resistance and 4H MA 50 25,700 to 25,850

Support Levels

• Current Pivot 25,050 to 25,200 (Tuesday lows 25,186)
• 24,500 support
• October lows 23,997
• Early 2025 ATH at 22,000 to 22,229 Support

The S&P also sparked a strong rebound in the morning session, with the last 4H candle closing at its highs.

Similarly as the Dow however, an immediate resistance level is getting reached which will have to be breached by the bulls for further continuation (look at the 4H 50 MA 6,855 for confirmation).

A triangle formation should precede strong breakout levels, the rest will be to spot whether they come to the upside or the downside.

Keep an eye on sentiment across all assets (Cryptos, Equities and Gold which correlate well this year.)

S&P 500 technical levels of interest:

Resistance Levels

• 6,930 (current All Time-Highs)
• ATH Resistance 6,900 to 6,930
• Immediate resistance 6,830 to 6,855

Support Levels

• Pivot and MA 200 6,720 to 6,750 (Tuesday lows)
• 6,680 to 6,700 support
• 6,570 to 6,600 Key support
• 6,490 to 6,512 Previous ATH now Support (MA 200 Confluence)

Safe Trades!

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