The NASDAQ 100 has been wild all trading session during the day on Thursday as the markets have been all over the place due to the Russians invading Ukraine. That being said, the market is going to continue to see a lot of noisy behavior but at the end of the day, it looks like the NASDAQ 100 has decided to ignore geopolitical issues, lease for the short term. That being said, there is no way to know where we go next, but I do think we are more likely than not going to see difficult trading.
If we were to turn around and rally at this point, it is very likely that we will run into a lot of trouble near the 14,500 level. That is an area that has been resistance previously, so it certainly makes quite a bit of sense that we would see this market look at that as a difficult barrier. Having said that, if we break above there then we need to deal with the 50 day and the 200 day EMA. For that matter, we are getting ready to form the so-called “death cross” when the 50 day EMA breaks below the 200 day EMA, which is a rather bearish turn of events.
On the other hand, if we turn around a break down below the candlestick for the session on Thursday, that would mean that we broke down below the 13,000 level and continue to slide from there. With that in mind I believe that this is a market that will continue to see a lot of choppy and volatile sessions, and I do not think that this is necessarily the end of selling. Because of this, I would be very cautious about the way you approach this market, but I still think it has a bit of a “fade on the rallies” type of attitude. I think most of what you have seen during the trading session on Thursday has simply been a bit of a relief rally after the situation in Ukraine did not spiral out of control. At the end of the day, we still have monetary policy tightening ahead, and a lot of concerns about growth. As long as that is going to be the case, the NASDAQ will suffer.
