Fed’s Dovish Pivot Boosts Sentiment, but Oracle’s AI-Led Plunge Caps Nasdaq Rally

Key Takeaways:

*Powell signaled openness to further easing in 2025, amplifying risk appetite beyond the fully priced-in 25bps cut.

*ORCL plunged over 10% after weak earnings, reviving concerns over stretched AI valuations and capping Nasdaq gains.

*Markets now balance supportive liquidity from Fed easing against fragile tech-sector fundamentals, shaping near-term equity direction.

Market Summary:

Wall Street sentiment strengthened after Federal Reserve Chair Jerome Powell delivered an unexpectedly dovish message alongside the widely anticipated 25-basis-point rate cut. While the policy move was fully priced in, investors zeroed in on the Fed’s forward guidance. Powell framed the third consecutive cut as a preemptive cushion for the labor market, noting that resilient economic growth and subdued inflation gave policymakers room to maneuver. The key surprise was the Fed’s explicit openness to additional easing in 2025, a signal that meaningfully boosted risk appetite across asset classes.

But the broader bullish impulse was partially overshadowed in the technology sector after Oracle (ORCL) suffered a steep, earnings-driven rout. Shares plunged more than 10% following disappointing quarterly results, reigniting concerns about stretched AI-linked valuations and the possibility of an emerging “AI bubble.” The sell-off created a stark divergence: while most major indices advanced on the Fed’s dovish pivot, the Nasdaq’s gains were held in check by this sector-specific shock.

The clash between supportive macro liquidity and fragile tech earnings sentiment is now poised to shape near-term equity market dynamics, with investors weighing the promise of easier monetary conditions against rising scrutiny over high-growth valuations.

Technical Analysis 

Nasdaq, H4:

The Nasdaq Composite is at a decisive technical inflection point after a week of sideways consolidation. A potential triple-top pattern has formed at the upper boundary of this range, presenting a risk of bearish trend reversal should the index fail to sustain its current level.

However, the pattern remains incomplete without a confirmed breakdown. The immediate focus is the lower support boundary of the consolidation range. A decisive daily close below this level, particularly if accompanied by the Relative Strength Index (RSI) falling below the 50 mid-line, would complete the triple-top formation and signal a strong bearish shift in momentum.

Momentum indicators are indeed showing signs of deterioration. The RSI is retreating from near overbought territory, suggesting waning upward pressure. Concurrently, the Moving Average Convergence Divergence (MACD) is declining from elevated levels and is poised for a bearish crossover below its zero line. This configuration indicates that prior bullish momentum has effectively dissipated.

Resistance level: 26,195.00，26,600.00 

Support level: 25,330.00, 24,850.00

Oracle (ORCL), D1

Oracle shares have staged a notable technical recovery following a significant correction that saw the stock decline more than 40% from its all-time high of $345.12. The decline was arrested at the critical pivotal support level of $190.00, from which the stock has rebounded approximately 17%. This successful defense of a major support zone suggests the underlying bullish structure may remain intact, provided the stock can sustain its footing above this level.

The rebound from the $190.00 pivot point is a key technical development, indicating substantial buyer interest emerged at a level perceived as a long-term value zone. This price action negates an immediate breakdown and sets the stage for a potential consolidation or recovery phase.

Momentum indicators support this constructive near-term shift. The Relative Strength Index (RSI) has rebounded decisively from oversold territory, indicating a rapid reduction in selling pressure. More significantly, the Moving Average Convergence Divergence (MACD) has generated a bullish golden cross at depressed levels and is now approaching a crossover above its zero line. This configuration suggests the intense bearish momentum that drove the decline has likely exhausted, creating conditions for a potential trend reversal or sustained relief rally.

Resistance level: 256.85, 342.00

Support level: 190.00, 152.65