- The NASDAQ 100 initially shot higher during the trading session on Thursday but then turned around to show a relatively negative look.
- That doesn’t mean that we must fall from here, just that it shows how we are starting to struggle with any type of bigger move.
- If we can break above the top of the candlestick, that would obviously be a very bullish site, but I think the upside is somewhat limited at this point.
If we were to break above the top of the candlestick, the next target I believe would be the 50-Day EMA. The 50-Day EMA is sitting right around the 12,633 level and is dropping. Feeding short-term rallies continue to work for me, but now, I think the Monday session is probably when I start to trade. After all, it’s very likely that we will see some short covering heading into the weekend, be because being short into the weekend is very difficult for some people. We are also near an area that has previously been resistant, so it should now have a bit of “market memory” to pay close attention to.
Markets Likely to Continue Being Bearish
If we break down below the 12,000 level, then it’s likely that the market is looking to the 11,000 level. The 11,000 level is where we had bounced from previously, and therefore I think there would be a lot of questions to ask in that general vicinity if we do break down below that level, then it could fly to the downside. The alternate scenario is that we can break above the 50-Day EMA, then it’s possible that we could go to the 200-Day EMA. This is sitting just below the 13,500 level and is dropping, and where a lot of longer-term traders will suggest that the trend is changing. I don’t necessarily think that’s going to be the case, but it’s something that we must at least consider. Ultimately, this is a market that looks bearish, and it should continue to be bearish if the fundamental situation and the central bank situation do not change. This scenario will continue to be one that I returned to, shorting this market on short-term charts as I believe we will continue to go much lower.
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