Where we are: Nasdaq futures are currently trading at 30320.50, down -0.03% and holding within a tight range of 30216.50-30370.50 established overnight. The cash Nasdaq 100 closed yesterday at 26917.47. We’re effectively flat heading into the US open, digesting yesterday’s gains and awaiting fresh catalysts.
What’s driving it: The domestic picture is one of measured calm. US 10-year yields are steady at 4.439%, and the 2-year is holding at 4.023%. Despite the relative quiet in yields, falling real yields are providing a tailwind for gold and indirectly supporting risk assets. The market is still pricing in a dovish reaction function from the Fed, and the positioning in Nasdaq futures suggests any positive earnings or AI news will be aggressively bought, triggering a potential squeeze, especially with net non-commercial positioning still showing a crowded short stance at the 4th percentile.
- The 2s10s spread has widened to 0.46%, suggesting a slight easing of recession fears.
- Speculator positioning in Nasdaq 100 futures remains net short, at the 4th percentile, highlighting a squeeze risk on any positive catalyst.
- Dan Ives’ comments, predicting the Nasdaq to top 30,000 by 2027 due to AI, are fueling bullish sentiment in the tech sector.
NY session focus: All eyes will be on the US data slate with the 08:30 ET prints looming large. A beat on core PCE could reignite inflation fears and pressure tech, while a miss could fuel further upside. Watch the 30,400 level on the upside; failure to hold 30,200 opens the door to a test of 30,000. The Dell trade is clearly working. The pain trade is a hawkish surprise pushing yields higher, triggering a sharp Nasdaq selloff.