- The NASDAQ 100 Index was very volatile on Tuesday as we had no real certainty by the end of the day.
- The market has been all over the place, so it does make a certain amount of sense that there are a lot of anxieties at the moment.
- The market has previously been on fire, so it’s interesting to suggest that we are at a major inflection point.
Important Candlestick Wednesday
The market has recently broken above a major resistance barrier in the form of the 13,500 level, so it certainly makes quite a bit of sense that it is offering a short-term support level. That’s exactly what we saw during the trading session on Tuesday, as we plunged lower only to see buyers step in and pick the market back up. By the end of the day, we were essentially unchanged, so it’s difficult to read much from this candlestick. It is because of this that I believe the Wednesday candlestick is probably going to be one of the most important ones over the last couple of months.
If we break above the top of the candlestick, then it’s possible that we could go looking to the 200-day EMA, which is currently right around the 14,065 level. After that, we have a significant amount of resistance at the 14,250 level, and that probably makes a significant target for those willing to get bullish at this point. On the other hand, if we break down below the bottom of the candlestick for the day, we could go lower to look toward the 13,000 level, an area where I expect to see a lot of support at based on “market memory”, as there was a lot of resistance in that general vicinity.
Keep in mind that the NASDAQ 100 is led by just a handful of companies, so you could probably call it the “NASDAQ 7" or so. Pay attention to all the usual actors such as Tesla, Microsoft, Alphabet, and the like. If they are rising, this index will rise right along with them. On the other hand, if they have a rough go, then we will see this market pullback to that 13,000 level. Either way, expect a lot of volatility going forward as we have seen getting here.
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