- The NASDAQ 100 has pulled back a bit during the trading session on Monday, as American traders are probably focusing more on Thanksgiving than anything else right now.
- With that holiday being Thursday, the later we get into the week, the more likely it is to be of a rather quiet session.
- Because of this, it’s not a huge surprise to see that we are drifting around in the same consolidation area we have been in for the last several candles, as we are sitting just above the 50-Day EMA.
If we were to break down below the 50-Day EMA, it opens the 11,500 level for an attempt to break down even further. Below there, it’s likely that we would see the NASDAQ 100 continue to drop, as it would head back into the previous consolidation area. That consolidation area drops all the way down to the 10,600 level or so.
High-Interest Rates Hinder the Markets
The shooting star from last week that pierced the 12,000 level needs to be overcome for the market to become bullish for a longer-term move, especially as the 200-Day EMA sits right at the 12,500 level. Quite frankly, if interest rates remain rather high, it does not bode well for NASDAQ 100 and profit list technology companies, which of course the NASDAQ is full of. You should also keep in mind that the NASDAQ 100 is driven by about 7 stocks, including the usual suspects like Microsoft, Apple, Tesla, and other big names.
I think the next couple of days will be interesting because the lack of trading volume really could start to put things into a very quiet mode over the next couple of days, but if we get some type of shock announcement or negative catalyst, that same lack of volume could take this market extraordinarily volatile. Because of this, you still need to be very cautious about your position sizing, especially as we head toward the end of the Wednesday session, as the underlying index will not be open on Thursday. Because of this, any movement that you see in a CFD market or even the electronic futures markets could be exaggerated, but at the end of the day, it certainly looks as if the risk is starting to disappear a little bit.
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