The NASDAQ 100 rallied significantly during the trading session on Tuesday, as it looks like the NASDAQ 100 is ready to continue going higher. The 14,600 level is an area that previously had been resistant, and now it looks like it offers support. After all, we have had a couple of rough weeks in what has been a major bubble. At this point, it’s very difficult to get overly aggressive to the downside against NASDAQ as it has been so noisy and bullish. That being said, I think that it remains a “buy on the dip” situation, especially as we head toward the end of the month. Remember, at the end of the month a lot of money managers will do everything they can to be in all of the “right stocks.”
Ultimately, the market is going to try to get back toward the highs again, and I think it probably won’t take too long to get there. I think ultimately, we will not only reach the 15,250 level but then continue to go much higher. The 50-Day EMA is above the 14,000 level now, and that should offer a bit of a “hard floor” in the market. Ultimately, I think this is a situation where eventually we will continue to see plenty of “FOMO trading” jumping in and chasing the market. At the end of the month, there will be a certain amount of markup in order for money managers to tell their clients that they are profitable.
Looking for a Pullback
- Even if we were to pull back from here, I believe that in the short term the 14,600 level will continue to hold and support, and then of course that 50-Day EMA underneath there.
- In fact, I don’t really have a scenario in which I’m willing to sell the NASDAQ 100 right now, despite the fact that the economy doesn’t necessarily jive with what we are seeing in the stock markets.
- Yes, eventually we will probably have a day of reckoning, but right now it does not look like the markets are too concerned about it, so with that being the case I think you probably continue to look at short-term pullbacks as buying opportunities.
Potential signals: The NASDAQ 100 continues to power higher and over the next couple of days we should see buyers. After all, there will be a certain amount of chase for performance. Because of this, I look at a pullback toward the 14,800 level as a buying opportunity with the 14,600 level being the stop loss. I still believe that we retest the 15,250 level.
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