US30 DETAIL ANALYSIS
1. Fundamental Analysis
The US30, tracking 30 of the largest publicly traded companies in the U.S., currently reflects a mixed but cautiously optimistic macroeconomic backdrop.
Economic Growth Outlook
The U.S. economy contracted by 0.5% annualized in Q1 2025, revised down from initial estimates. The contraction was largely driven by a surge in imports before new tariffs took effect, which distorted net exports. As a result, the Federal Reserve revised its 2025 GDP growth forecast to approximately 1.4%—a downgrade from the previous 1.7% projection. Private-sector forecasts, including those from Deloitte and S&P Global, echo this view, suggesting a growth range between 1.1% and 1.5% for the year.
Inflation & Federal Reserve Policy
Core PCE inflation—the Fed’s preferred metric—rose to 2.7% year-over-year in May, above the central bank's 2% target. Similarly, core CPI held at 2.8%. While inflation is cooling compared to previous cycles, it remains sticky. Consequently, the Fed has signaled no immediate plans to cut rates, with the earliest possibility being in September. Inflation expectations for year-end 2025 have been revised up to around 3%, in part due to geopolitical shocks and new tariffs.
Labor Market & Consumption Trends
The unemployment rate remains stable near 4.2%, reflecting labor market resilience. However, real disposable income and consumer spending both declined in May, down 0.3% and 0.7%, respectively. The drop indicates potential weakening in consumer demand and future GDP prints. Confidence indices also showed a dip, although a decline in inflation expectations could moderate the downside pressure.
Tariff Effects and Global Risk
Average U.S. tariff levels are at historic highs, ranging between 15–19%, weighing on import costs and corporate margins. The ongoing trade frictions with China, coupled with Middle East tensions (particularly between Israel and Iran), add geopolitical volatility and inflationary risks. Leading institutions warn of stagflation—a toxic mix of slow growth and persistent inflation—pressuring equity valuations.
2. Commitment of Traders (COT) Report Evaluation
The latest COT data reflects a nuanced view of institutional behavior in equity index futures:
Asset Managers have increased net long exposure to US indices, including the Dow, suggesting underlying bullish conviction from long-term holders.
Leveraged Funds (Hedge Funds) have shown mixed sentiment—reducing short positions, but not aggressively adding longs—indicating a cautious optimism.
Retail Traders are predominantly short , which often signals further upside potential due to their tendency to be positioned against the dominant trend.
This asymmetric positioning—combined with macro and structural tailwinds—strengthens the smart money bias toward continuation of the bullish trend, especially as the Dow approaches key technical levels.
3. Technical & SMC-Based Analysis
The daily US30 chart reflects a clear bullish structure, rooted in classic Smart Money Concepts:
Market Structure
A Valid Break of Structure (BOS) confirms upside intent, following a successful sweep of internal liquidity.
The sequence of Higher Highs (HH) and Higher Lows (HL) remains intact.
Internal Liquidity has been swept, with price now targeting external liquidity near the All-Time High (ATH) zone.
Key Technical Levels
Buying Area 1: Around 43,150 – labeled as the H4 inducement zone. A retest here with bullish price action (engulfing or FVG fill) may trigger continuation long entries.
Buying Area 2: Between 42,450–42,650 – a deeper demand zone where price previously showed strong displacement. A high-probability re-entry zone upon confirmation.
Short-Term Sell Area: Around 44,800 – this zone aligns with potential distribution. Short positions should only be considered here upon confirmation of bearish BOS.
ATH & BSL: The final liquidity target in the current structure, marking the range highs.
Liquidity Pools
Sell-Side Liquidity (SSL): Around 41,800, and a Strong Low exists near 40,900 – both are key areas to be respected in the bullish thesis.
Price is currently aiming toward external BSL above ATH, which is likely to be swept before any significant correction.
4. Strategic Outlook & Trade Plan
✅ Bullish Continuation Scenario
Buy Entry #1: 43,150 zone – confirmation through bullish PA on retest.
Buy Entry #2: 42,450–42,650 – deeper re-entry upon mitigation of FVG or OB.
Take Profit Targets:
TP1: 44,800 (potential distribution zone),
TP2: 45,200 (external BSL at ATH).
Stop Loss: Below 42,200 (under Demand Area 2 or SSL).
⚠️ Bearish Contingency (Only if BOS to Downside)
Monitor for failed structure or strong rejection at 44,800–45,200.
BOS below 43,000 could shift structure and signal a move toward the 42,200 zone.
Break of Strong Low (~40,900) invalidates bullish structure.
Conclusion
The current market environment supports a measured bullish bias in the US30, driven by:
Resilient labor and inflation expectations moderating;
Institutional accumulation per COT data;
A technically clean smart money bullish structure;
Potential for liquidity sweep above ATH before any significant distribution.
That said, macro risks such as tariffs, global geopolitical tensions, and sticky inflation remain key wildcards that could introduce volatility.
NOTE: ONLY FOR EDUCATIONAL PURPOSE NOT A FINANCIAL ADVICE
