U.S. Stock indices higher on Bad economic data? 🤔

Risk-On Sentiment has taken over the markets today despite bad manufacturing and services data.. and it began yesterday on Nasdaq with the Daily candle closing back above the Daily Level 17,164. Other confluences for the increase on Nasdaq include 1) Jerome Powell's hawkish comments on April 16th.
2) Dollar Index 5 minutes chart : Here we can observe the Risk on sentiment with the data this morning. The dollar Index represents the U.S. dollar of course and puts it againsgt a basket of currecies(4) . Since the USD is a safe haven.. and the dollar index is going down.. this represents money flowing into other asset classes as ivestors see better retruns elsewhere such as Nasdaq (Risk-On U.S. stock index). This is what we would expect to see with bad USD data

3)The Fakeout price action on Monday suggesting Buys today

4) Volatility Index (Vix) 5 minutes chart : We can observe that price decreased during london session and through the not so great USD data release. This means that more investors are buying call options in the S&P500 companies anticpating that the stock indexes will rebound to the upside. This could have been correlated with buying the stock indexes like Nasdaq after it jumped up with the data release this morning.

Let me know what your thoughts are on the Nasdaq! These publications are for general and educational purposes only. Not trading or financial advice.

Trade closed: stop reached:

Take profit hit at 17,598 4hr zone on Nasdaq. We may now observe some selling pressure as we transition into London session and to conclude asian session, waiting for an hourly bearish candle or even better a 4hr bearish candle can help give confirmation for a move to the downside.

Comment:

we recieved a 4hr candle that closed bearish, and this next 4hr candles has retested the 17,598 4hr zone and left a top wick. The NY Open 1hr candle closed bearish as a shooting star candle.

Comment:

Long Bias this week