- The NASDAQ 100 continues to look for cheap money coming out of Wall Street, as we see a lot of noisy behavior.
- The FOMC meeting late on Wednesday will have a major influence on where we go next.
NASDAQ 100
In the NASDAQ 100, a familiar pattern persists: whenever it experiences a dip, eager buyers quickly step in. As the Federal Open Market Committee (FOMC) meeting looms for Wednesday, market participants anticipate heightened volatility in the coming hours.
The NASDAQ 100 witnessed a modest decline during Wednesday's trading session but displayed resilience by reversing its course. This shift suggests the possibility of a rally, with potential ambitions to return to the previously breached consolidation range.
It's worth noting that this market is known for its inherent noise, with frequent fluctuations in sentiment. Furthermore, the imminent FOMC meeting is poised to exert significant influence over how investors approach the broader stock markets. If the prevailing monetary policy hints at a forthcoming loosening in the year, Wall Street is likely to welcome such news with open arms. It's essential to remember that Wall Street's primary concern revolves around liquidity and market dynamics rather than broader economic factors.
It’s Not 100 Stocks…
Additionally, it's crucial to recognize that the NASDAQ 100 is primarily driven by a select few stocks, numbering around six or seven. As long as these core stocks, including prominent names like Nvidia, Microsoft, and Tesla, maintain their positive trajectories, the NASDAQ 100 may continue its extension rally.
At the current juncture, market sentiment leans towards viewing any potential pullback as a buying opportunity, particularly in the vicinity of the $16,950 level, which previously served as a resistance point. Of course, this assumption relies on whether such a pullback materializes. In the event of a breakout that establishes a new high, the path to the $18,000 level could be laid out, a scenario consistent with the NASDAQ's upward trajectory since October of the preceding year.
Navigating this market's volatility necessitates adopting a strategy of buying on the dips. While concerns about a potential future downturn loom, there are currently no discernible indicators to support such fears. Therefore, aligning with the prevailing trend remains the prudent course of action. As a result, the market continues to present opportunities for investors to enter at lower levels, offering a rationale for seizing these chances when they arise.
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