The month of June had been a positive one for indices in the exchange market. Thus, most of the index family had sustained their bullishness for two consecutive weeks. Cryptocurrency and commodities have been prevalent in their market trend. Indices such as S&P 500 Index, US 100 Index (also known as Nasdaq 100), Volatility S&P 500 Index, Dow Jones Industrial Average, US 30, SPX500, HK50, JP225, FRA40, CHI50, ESP35, IT40, etc., had remained stable and bullish in the last two weeks.
S&P 500 Index is up by 0.35% with the price at $4122 during Asian session; US 100 Index is up by 0.42% at $12599.60; Volatility S&P 500 Index rose by 1.12% priced at $27.08; Dow Jones Industrial Average is up by 0.05% at $32915.80.
The prevailing sentiment towards indices is bullish. Many analysts forecast the possibility of the uptrend likely to continue for the rest of the week. However, buyers must watch for the CPI data to be released this week to determine if the bullishness will continue.
Beginners guide on how to trade Indices
Indices, as we know, are compositions of various stocks put together as one family. Hence, the movement of the high market cap stocks included in a particular index affects their price faster than the smaller ones. Therefore, to trade a given index effectively, the trader must meticulously understand the major stocks making up the index and follow their movements. For instance, Nasdaq 100 comprises the major hundred US technology company stocks. The various stores making up the Nasdaq 100 are usually listed from the largest to the smallest. They are often used as a yardstick to measure the health of the US technology sector. The largest twenty companies making up the Nasdaq 100 are listed below.
20 Prime stocks from the Nasdaq 100 Index
« Apple (NASDAQ: AAPL)
« Microsoft (NASDAQ: MSFT)
« Amazon (NASDAQ: AMZN)
« Tesla (NASDAQ: TSLA)
« Nvidia (NASDAQ: NVDA)
« Alphabet (C shares) (NASDAQ: GOOG)
« Alphabet (A shares) (NASDAQ: GOOGL)
« Meta Platforms (NASDAQ: FB)
« ASML Holding (NASDAQ: ASML)
« Broadcom (NASDAQ: AVGO)
« Costco (NASDAQ: COST)
« PepsiCo (NASDAQ: PEP)
« Cisco Systems (NASDAQ: CSCO)
« Comcast (NASDAQ: CMCSA)
« Intel (NASDAQ: INTC)
« Adobe (NASDAQ: ADBE)
« AstraZeneca (NASDAQ: AZN)
« Advanced Micro Devices (NASDAQ: AMD)
« Qualcomm (NASDAQ: QCOM)
« Texas Instruments (NASDAQ: TXN)
Therefore, to trade this index given above effectively, one must follow the trend in these twenty stocks listed above.
On the other hand, one can trade just one stock alone if one finds it difficult to master these pairs using any of the stocks provided by ATFX brokers. We have also listed other factors that move indices in subsequent publications.
Seven price factors that move Indices
« News from major composite companies
« Interest rate hikes
« Central bank policies
« Fiscal policies
« Geopolitical events and wars.
« Natural disasters.