FX.co ★ Weekly review of US stock market, November 23

The main US stock indexes are trading at their highs. However, there are clear signs of a correction.

At the very end of the week, the main US stock indices showed a strong downward reversal from the highs. They fell by about 1.5%. Investors have been anticipating the stock market correction for a while despite the fact that the US economy is now strong. Apparently, traders have already priced in all the positive reports and there is no reason for a significant increase from current levels. An additional reason for big sales may be the long weekend on the occasion of Thanksgiving.

Weekly results of the main US stock indices:

The Dow was trading at 36,150 - 35,600. It dipped by 550 or 1.5%

The NASDAQ composite was trading at 15,970 – 15,850. It dropped by 120 or 0.8%

The S&P 500 was trading at 4,700 – 4,684. It lost 16 or 0.4%

Outlook

The Dow is likely to trade in the range of 35,300 - 35,800

The NASDAQ Composite may remain in the range of 15,600 – 16,000

The S&P 500 is likely to stay in the range of 4,600 – 4,700

Conclusion

Now, analysts are sure that the Fed is likely to hike the interest rate to curb rising inflation. There might be also a slowdown in the US economy, which will trigger a correction in the stock market. It is only a matter of time. The question is what levels the stock indices will reach before the fall. Additionally, the US stock market is already overheating. So, a strong drop in the stock market may adversely affect the US economy.