Published: 25 December 2025,06:08
Daily Market Analysis New
Key Takeaways:
*The Dow, S&P 500, and Nasdaq continue to trade near record levels, driven by traditional year-end seasonal momentum.
*Easing inflation pressures, declining bond yields, and expectations of accommodative monetary policy have underpinned investor confidence.
*Gains are concentrated in technology and AI-linked stocks, supported by resilient earnings and structural growth narratives; cyclical sectors also benefit from steady U.S. growth.
Market Summary:
U.S. equities continued to benefit from seasonal momentum heading into Christmas, with the Dow Jones, S&P 500, and Nasdaq holding near record territory as the Santa Claus rally remained intact. Investor confidence has been buoyed by a combination of easing inflation pressures, declining bond yields, and expectations that monetary policy risks are skewed toward accommodation rather than restriction in the year ahead.
The rally has remained concentrated in technology and AI-linked names, particularly within the Nasdaq, where earnings resilience and structural growth narratives continue to attract capital. At the same time, cyclical sectors have found support from relatively resilient U.S. growth data, reinforcing the soft-landing narrative that has underpinned equity sentiment throughout the second half of the year.
However, participation has thinned markedly, with holiday closures suppressing volumes and muting volatility. Gains have been achieved with limited confirmation from breadth or turnover, leaving indices vulnerable to sharper adjustments once institutional investors return in early January. Valuation concerns and fiscal uncertainty have not disappeared, but they have been temporarily sidelined by seasonal flows and the absence of negative catalysts.
For now, Wall Street remains supported by falling yields, stable earnings expectations, and favourable year-end dynamics. Directional conviction, however, is likely to be tested once markets reopen and attention shifts back to data-driven reassessment rather than calendar-driven optimism.
Technical Analysis
Nasdaq continues to trade within a well-defined medium-term uptrend on the chart, maintaining a constructive technical structure despite recent volatility. Price action remains supported above the broader bullish base established since late summer, with higher highs and higher lows still largely intact.
After rallying strongly toward the 26,100 region, NDX encountered supply pressure near the upper boundary of its recent range. The subsequent pullback was corrective rather than impulsive, finding buyers ahead of the key 23,900 Fibonacci support level. This area aligns with the 0.786 retracement of the prior advance and has acted as a critical demand region, helping to stabilize price and preserve the broader bullish bias.Structurally, the index is now attempting to re-establish upward momentum, trading back above its short-term moving averages.
Momentum indicators support a cautiously constructive outlook. The RSI has rebounded toward the 60 area after holding above the neutral 50 level, indicating that bullish momentum remains present despite intermittent pullbacks. This behavior reflects healthy trend digestion rather than distribution. Meanwhile, the MACD has turned higher with a positive crossover, and the histogram is gradually expanding, signaling improving upside momentum following the recent corrective phase.
Resistance Levels: 25,695.00, 26,400.00
Support Levels: 23,900.00, 22,500.00
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