- During the trading session on Tuesday, we saw a lot of buying in the Nasdaq 100.
- It looks like we are just simply trying to wipe out all of the losses from the Monday session.
- In fact, late on Monday, you started to see buyers jump back into this market.
I think you have a situation where we are trying to form a basing pattern. Really what we need to see is some type of grand deal from the tariff situation to perhaps lead the market higher for more of a sustainable rally. However, it's obvious that most of the aggressive panic selling seems to be gone. Now we are just seeing people trying to position for what the reality is.
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It's not a situation where people are at least putting their money to work in positions where the world is going to end. Remember every time we pull back, it’s pretty rare that you get a V bottom and most of the time you see some type of consolidation and that might be what we're looking for now.
Chasing the Shorts Will be Difficult
The market shorting here is a little bit difficult. It's not that it can't work, but be honest here, you know that if Trump tweets some type of an agreement between the EU or Japan, this market is going to rip to the upside. Granted, China is going to be much more difficult, but once the West and Japan show a little bit more of a united front, it'll put a lot more pressure on China. If that ends up being the case, the NASDAQ is going to rip because it's probably only a matter of time before the Chinese find a way to make a deal that at least saves some face with the Americans. This could take two days. This could take two months. You just don't know. And I think that's what we're seeing here is a market that is just waiting for that news. The panic is over, at least for the time being. And now we are holding our breath.
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