Why Markets Are Climbing and How to See Things More Clearly

Hey everyone! If you follow the markets, you surely noticed yesterday. It was a sort of "bullish frenzy" where everything just kept going up. You know that feeling? You feel like you're buying at the top at 650, then you tell yourself the same thing at 700, and the market continues to climb. You're afraid of being the last one to buy just before everything collapses. It's a typical feeling on these kinds of days that, frankly, I'm not a big fan of. In this article, I'll explain the three factors that, in my opinion, have reassured the markets and caused this rise. Then, we'll do a technical overview of the main indices.

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The 3 Reasons for This Renewed Confidence

So, why all this optimism? In my view, it comes down to three main things that have created a calmer climate.

1. US Interest Rates

The first thing that really reassured everyone: US interest rates dipped below 5%. That's a strong signal that was very well received.

2. Calm in the Oil Market

Secondly, the price of a barrel of oil remained stable at around $101, without accelerating towards $110 or $120. And yet, the news wasn't good! We learned that the Iranians had fired on a supertanker. Six or seven months ago, such news would have sent the stock market into a panic. This time? Nothing. The price didn't budge. This shows that the market is somewhat saturated with bad news about oil and it no longer causes panic.

3. The Fed's Communication

The third point, and this is what fascinates me the most, is market psychology. The Fed raised its rates by a quarter of a point, as expected. No surprise there. But what's interesting is what happened behind the scenes. The 18 members of the Fed (yes, there are 18 of them, now you can show off at your next family dinner) were all in agreement for this hike, including their chairman. That's a good sign; it shows someone is at the controls.

Furthermore, their chairman, whom I affectionately call Kevin, was very direct. He basically said, "Listen, on energy prices, I can't do anything. That's not up to me." This honesty was greatly appreciated. He didn't try to beat around the bush. This transparency builds confidence, and confidence is what drives the markets.

My Technical Analysis of the Main Indices

Now, let's look at what this means on the charts. It's good to understand the context, but trading is also about observing key levels.

The CAC 40: The Yo-Yo Continues

On the CAC 40, we're still in the same dynamic I've been describing for a week. The index is yo-yoing in its range-bound zone. Yesterday, we hit the resistance around 8,200 points, then came back down. The zone is working perfectly. For now, this is our first real bullish day in over a month, which is already something!

The DAX: German Discipline

The German DAX is doing a bit better. It's known for being a pretty disciplined index. We've broken through significant resistance, and what's interesting is that we've bounced off it. This former resistance has become support. As long as we stay above approximately 25,750 points, it's a very good sign.

The NASDAQ: The Unbeatable Star

Ah, the NASDAQ… It's the tricky one! It's the strongest right now. It has rebounded well and is back at its recent highs. What makes it solid is that it has very strong support around 29,700 points. Why such strength? Because all the money is flowing into tech: AI, chips, graphics cards… It's the trendy sector. Everyone is talking about it, from the hairdresser to the bus driver, so people are buying in droves.

The Other US Indices (Dow Jones & S&P 500)

The Dow Jones has risen, but you can feel it's facing more struggles. The S&P 500 is also a bit more held back as it is quickly approaching a resistance zone. So, the situation is simpler for the NASDAQ, which has more support behind it in case of a downturn.

A Look at Gold, Bitcoin, and Oil

• Gold: For now, it's not moving a whole lot. We've been in a range for a week, currently in the upper part. A bit positive, presumably, but nothing crazy. Not the time to sell your wedding ring just yet!

• Bitcoin: It remains very volatile, stuck between $75,000 and $80,000. Fewer and fewer people are in crypto; it's a trend that's fading a bit. Always be wary of products that make you dream of getting rich quick without doing anything.

• Oil: As we've seen, it's stable. It's holding near the $100 mark and its monthly resistance. The fact that it's not skyrocketing is one of the calming signs for the markets.

Conclusion

To sum up, the markets want to go up, and several signals are green. Yet, as I said at the beginning, it's tough to buy at highs like these. You're always afraid of the correction that will come right after. This is where patience is important. You shouldn't let yourself be consumed by the regret of not having taken a position.

The most important thing remains protecting your capital. The name of the game isn't to make the trade of the century, but to avoid getting wiped out so you can continue trading the next day. And don't worry, even when we're long gone, the stock market will keep on turning!

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