Dow Jones, the S&P 500, and Nasdaq price forecast after last week’s gain

Wall Street’s three main indexes advanced last week as the data showed that growth in a key inflation gauge slowed, and investors ignored geopolitical turmoil and Federal Reserve tightening concerns.

All three major U.S. stock indexes snapped their longest weekly losing streaks in decades amid growing optimism that the Federal Reserve will be able to tighten monetary policy without tipping the economy into recession.

Data released on Friday showed better-than-expected consumer spending, while the monthly price growth showed a sharp deceleration to 0.2% from 0.9% and a less pronounced decline on an annual basis to 6.3% from 6.6%.

Despite this, Bill Adams, chief economist for Comerica Bank, said that rising prices would continue to be a major problem for the U.S. economy for at least the rest of the year. Bill Adams said:

Yes, inflation is finally slowing, but it’s a little early for high fives. Gas and food prices continued to rise in May, and the risk of additional supply-side shocks remains high as the Russia-Ukraine war grinds on, and lockdowns drag on in China.

The war between Ukraine and Russia continues to cause supply chain issues for many companies, and since the beginning of the war, raw materials and commodities prices have surged, intensifying already-high inflation.

This trading week will be busy; the U.S. will publish the official May ISM PMIs and monthly employment figures for May, which is a key economic indicator for the United States.

S&P 500 up 6.58% on a weekly basis

For the week, S&P 500 (SPX) booked a 6.58% increase and closed at 4,158 points.

Data source: tradingview.com

The S&P 500 closed in the green for the first time in eight weeks, and the next resistance level stands at 4,200 points.

The current support stands at 4,000 points, and if the price falls below this level, it would be a “sell” signal, and we have the open way to 3,800 points.

DJIA up  6.24% on a weekly basis

The Dow Jones Industrial Average (DJIA) advanced 6.24% for the week and closed at 33,212 points.

Data source: tradingview.com

The important resistance level stands at 34,000 points, and if the price jumps above this level, we have the open way to 34,500 points. On the other side, if the price falls below 32,000 points, it would be a firm “sell” signal, and the next target could be around 31,500 points.

Nasdaq Composite up 6.84% on a weekly basis

For the week, the Nasdaq Composite (COMP) booked a 6.84% increase and closed at 12,681 points.

Data source: tradingview.com

The strong support level stands at 12,000 points, and if the price falls below this level, the next target could be 11,500 points.

Summary

The Dow Jones, the S&P 500, and the Nasdaq advanced last week amid growing optimism that the Federal Reserve will be able to tighten monetary policy without tipping the economy into recession. The U.S. will publish the monthly job report on Friday, and investors will continue to pay attention to the Federal Reserve commentaries looking for any clues.

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