US stocks hesitant rally: Markets pass the Core PCE and U-of-Mich data bar

US Equities have gone into yet another spectacular run but after delivering a strong open, they start to show some hesitancy.

As the Bureau of Labor Statistics reopened, traders were initially concerned that the first public US data releases wouldn't be supportive of a December Fed cut—a worry that partially fueled the mid-October to end-November struggle.

However, since NY Fed President Williams appeared with a dovish speech that reset expectations, things have been back to normal, almost as if nothing happened the past two months.

The rebound has been massive: The Dow Jones is trading close to 48,000, the S&P 500 came shy from 6,900, and the Nasdaq is less than 2% from its all-time highs after a mid-month 9% correction.

The bullish narrative found further strength today: an as-expected Core PCE release (the Fed's preferred gauge) combined with encouraging inflation expectations from the University of Michigan report and Tuesday's ADP Labor miss not only support the 25 bps cut and even further cut pricing into 2026.

Elevated equity levels require such rate accommodation to maintain their performance, particularly at this point in the cycle where tech and growth firms need lower financing rates to sustain high Capital Expenditure for AI infrastructure.

Enough economic talks; Some small profit-taking at the highs is currently ongoing, so let's dive into the Indexes intraday charts for Dow Jones, Nasdaq and S&P 500 as they look to conclude yet another green week.

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After a huge open taking the index to new Monthly highs (48,131), some sellers appear to defend the 48,000 level.

With the strictly positive week, traders haven't taken a break from the buying and it seems that as such flows start to lose some steam as can be seen with the descending RSI.

They are locking in some profits as next week's pivotal FOMC approaches.

Keep an eye on the 48,000 level:

• A close below indicates further caution after such a swift move higher and may indicate selling action ahead of the FOMC.
• Any selling flow should maintain above the 47,000 psychological level, except for any sudden fundamental change.
• Above the key level, optimism stays at its peak and this sentiment should drag all the way to the Fed Meeting.

Dow Jones technical levels of interest:

Resistance Levels

• Current All-time high 48,459
• Psychological resistance at 48,000 +/- 100 pts (immediate test)
• Session highs 48,131

Support Levels

• Key Pivot zone 47,500 - 47,650
• Higher timeframe Support 47,000 to 47,200
• 46,000 +/- 300pts Immediate Support
• Tuesday Lows 45,925
• 45,000 psychological level (next support and main for higher timeframe)

Nasdaq has held an even-stricter bullish momentum this week, forming a bull channel that solidly acted as support on most pullbacks.

Similarly as in the Dow, Sellers are appearing around the last resistance before the all-time highs, attempting a break at the Market open but seeing some intermediate rejection.

The RSI is holding strong, not showing any detail of what to expect here but some key levels are coming into play around here:

• Breaking the daily highs (25,833) and closing above maintains the track to a test of the all-time highs ahead of the FOMC
• Rejecting and closing below would test the lower bound of the upward channel (25,500) which coincides with the Major Momentum Pivot.
• Breaking lower should still see rangebound action with the 25,000 Support acting as a key barrier.

It would be a rare event to see a huge breakdown with no data expected before Wednesday's event.

Still, keep an eye on Magnificent 7 Stocks in case anything happens there (like Nvidia, or Meta which haven't had the most bullish cases)

Nasdaq technical levels of interest:

Resistance Levels

• intermediate resistance 25,700 to 25,850 (immediate test)
• Session highs 25,833
• All-time high resistance zone 26,100 to 26,300
• Current ATH 26,283 (CFD)

Support Levels

• Major Pivot 25,500 +/- 75 pts
• Support 25,000 to 25,250
• 24,500 Main support and Pivot (recent rebound)
• October lows 24,000
• Early 2025 ATH at 22,000 to 22,229 Support

Even after a strictly positive week for the S&P 500, it seems that the broader environment is starting to look more like a big consolidation rather than a full regaining of the bull-trend.

Failing to breach 6,900, sellers may just appear to take the upper hand on the short-run.

Still, psychological levels will be essential for the Index:

• 6,850, the lower bound of the mid-term resistance, will be a level to hold to avoid further mean-reversion.
• Any close above 6,900 points to a quick test of the all-time highs
• A rejection below 6,800 should still see support at the 6,750 level, accompanied by the 50-period MA.

S&P 500 technical levels of interest:

Resistance Levels

• 6,930 (current All Time-Highs)
• Session highs 6,896
• Current Resistance 6,850 to 6,880 (testing)
• ATH Resistance 6,900 to 6,930

Support Levels

• 6,800 Psychological Pivot
• Support 6,720 to 6,750 and 8H MA 50
• 6,490 to 6,512 Previous ATH October lows (recent lows)
• 6,400 psychological support

Safe Trades!

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