- The NASDAQ 100 has fallen a bit during the trading session on Thursday only to turn around and show signs of life.
- It’s worth noting that we are seeing a little bit of pushback at this point, as we are sitting at previous resistance.
- That being said, the market is more likely than not going to be focusing more on the jobs number than anything else, so I don’t necessarily think that a rush of buying into the market.
- After all, this is a scenario where we see a lot of short covering heading into a volatile market.
If we break above the top of the candle, it’s possible that we could dance to the 12,500 level, perhaps even opening up the possibility of a move to the 50-Day EMA. The 50-Day EMA is at the 12,750 level. Any rally at this point in time looks to me to be a potential shorting opportunity, but you should keep in mind that the Monday session is Labor Day in the United States, so there won’t be any trading on the underlying index. Any electronic trading that you could do should probably be avoided unless of course, something truly horrific comes out during the job number.
Expect a Couple of Volatile Days
All things being equal, this is a market that I think you will find a way to bounce and then sell off, but if we were to break down below the bottom of the candlestick for the Thursday session, we go lower, and I do think eventually that happens. At that point, the market is more likely than not going to reach the 11,000 level. The 11,000 level was roughly where we bounce from previously, and I do think that’s the target long term. As the Federal Reserve continues to tighten monetary policy, it puts a whipping on technology stocks. Furthermore, it’s very likely that we are looking at a recession coming down the road, and it makes quite a bit of sense that stocks will continue to pay the price. It rallies at this point look suspicious to me, and the first signs of exhaustion will be a selling opportunity for me. Regardless, I think you are probably on the hook for a couple of volatile days over the next couple of sessions.
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