- The NASDAQ 100 has been very bullish as of late, and it looks as if it is ready to continue going higher yet again.
- After all, PPI numbers came in cooler than anticipated, and therefore traders continue to bet on the idea that the Federal Reserve might be able to engineer some type of “soft landing” after all.
- Whether or not that actually ends up being the case is a completely different story, but ultimately it doesn’t really matter, due to the fact that we have plenty of momentum to the upside.
Underneath, I believe that the 15,250 level continues to be a major previous resistance. That now has quite a bit of “market memory” attached to it, meaning that we could see traders look to it as a bit of a short-term floor the market. If that’s going to be the case, then it’s probably only a matter of time before we go much higher. When I look at this chart, you can make out a pretty obvious ascending triangle, which also had a ceiling near that level. With that in mind, I like the idea of buying dips as they occur, and I do think that we have much further to go. In fact, when you take the ascending triangle and extrapolate the “measured move” out into the future, we should be looking at roughly 15,750 at the least.
Volatility Ahead
Keep in mind that there is only a handful of stocks that are moving the NASDAQ 100 these days, namely the top 8 or so. However, as long as the “AI narrative” continues, it’s very likely that we have a situation where the market remains a “buy on the dips” scenario that just is not going anywhere. With that in mind, I believe that we have a situation where it’s only a matter of time before traders come back in to chase the momentum that we have seen.
I have no interest in shorting this market, despite the fact that the actual underlying economy is probably tepid at best. I do believe that we will continue to see plenty of volatility, but it’s obvious to me that the buyers have the upper hand, and as long as that’s the case, there is no reason to fight the overall trend. With this, the 50-Day EMA underneath also offers a significant amount of support.
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