CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 83% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

USA500

Special Reports - 15/11/2022

15 November, 2022

The example below uses Contracts For Difference (CFDs). Calculations are only on the price of the specific instrument on the date below and calculations indicate a possible opportunity for profit or loss. No representation or warranty is given as to the accuracy or completeness of this information, consequently any person acting on it does so entirely at their own risk.

USA500 (USA500) weekly uptrend opportunity based On 1.00 Lot Calculation:

  • DESCRIPTION: The USA500 is a capitalization weighted index of 500 of the largest firms listed on American exchanges. The index is filled with many companies that are highly sensitive to interest rates.

  • INFLATION CRESTED: The United States Consumer Price Index (CPI) was reported to be 7.7%, Year-overYear, for October and the Core CPI came in at 6.3%, Year-over-Year. Both of these figures were lower than the prior months and lower than had been forecast.

  • NEWS: The U.S. Federal Reserve may be soon taking a less aggressive stance on interest rates. The U.S. central bank is committed to fighting inflation. However, it is very sensitive to economic data. On November 14th 2022, Vice Chairman Lael Brainard stated, “I think it will probably be appropriate soon to move to a lower pace of rate increases.”

  • FUTURES MARKETS PROJECT EASING FINANCIAL CONDITIONS: The current forecast for the Fed Funds interest rate increase at the next FOMC meeting in December is a 80% of a 50 basis point increase, and 20% of a 75 basis point increase. A month ago it was reversed with a 29% chance of a 50 basis point increase and a 70% chance of a 75 basis point increase. These markets are reflecting easing financial conditions.

  • USA500 AFTER MIDTERM ELECTIONS: Since 1962, the USA500 has rallied an average of 7.3% in three months after a midterm election in the United States.

  • FUNDAMENTAL ANALYSIS: The current price-to-earnings ratio (P/E) for the USA500 index is 19.1. The two-year average P/E is 24.9.

  • 3RD QUARTER EARNINGS SEASON IS EFFECTIVELY OVER: The most feared earnings season in many years has almost finished. There were many disappointments, both in terms of the reported quarters as well as disappointing forward guidance. All of the bad news has been digested and is now priced into the markets.

  • TECHNICAL ANALYSIS: The USA500 is 17% below its all-time high of 4818.62 reached in early January 2022. The index would need to climb over 20% from its current level to recapture that high again. However the price could also decline further.

(USA500), November 15, 2022
Current Price: 4,000.00

USA500

Weekly

Trend direction

UP

Resistance 3

4,600.00

Resistance 2

4,400.00

Resistance 1

4,200.00

Support 1

3,850.00

Support 2

3,700.00

Support 3

3,550.00

Example of calculation based on weekly trend direction for 1.00 Lot1

Pivot Points

Resistance 3

Resistance 2

Resistance 1

Support 1

Support 2

Support 3

Profit or loss in $

6,000.00

4,000.00

2,000.00

-1,500.00

-3,000.00

-4,500.00

Profit or loss in €2

5,766.46

3,844.31

1,922.15

-1,441.61

-2,883.23

-4,324.84

Profit or loss in £2

5,072.71

3,381.81

1,690.90

-1,268.18

-2,536.35

-3,804.53

Profit or loss in C$2

7,956.00

5,304.00

2,652.00

-1,989.00

-3,978.00

-5,967.00

  1. 1.00 lot is equivalent of 10 units

  2. Calculations for exchange rate used as of 08:36 (GMT) 15/11/2022

Fortrade recommends the use of Stop-Loss and Take-Profit, please speak to your Client Manager regarding their use.

  • You may wish to consider closing your position in profit, even if it is lower than suggested one.

  • Trailing stop technique can protect the profit – Ask your Client Manager for more detail.

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