The NASDAQ 100 continues to see a lot of noise, as we have seen a bit of selling pressure toward the end of October. This is a market that has weathered a significant storm.
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NASDAQ 100
The Nasdaq 100 has struggled during October, falling rather significantly to slam into the 29,000 region toward the end of the month. The 29,000 level is a large, round, psychologically significant figure and an area that continues to see a lot of buyers jump in to lift this market.
I suspect that this upcoming month of November may see more of the same if the interest rate situation in the United States starts to cool off. We have seen that toward the end of the month, and the market is likely to continue to see this. Whether or not things can continue to the upside, or at the very least remain neutral, I suspect we probably do get a bounce sometime during the month, maybe due to economic numbers in the United States cooling off and starting to show signs of a little bit of relaxation.
The inflation numbers have been a little bit high, but it is also worth noting that earnings season is going on at the end of October and, so far, it has been relatively decent.
The market has been sideways since May
Traditionally, the market sees a little bit more buying pressure the closer we get to the holidays, and therefore I think November might be the beginning of a short-term rally. Whether or not it is explosive remains an open question, and I think we would have to clear the 31,500 level to get any real traction.
If the market were to drop below the 50-week EMA at the 27,645 level, then it is likely that we see even deeper correction behavior, perhaps down to the 24,000 level. Ultimately, though, I suspect this is going to be very similar to the last couple of months, but the buyers certainly seem to have the upper hand from a longer-term standpoint.
My take on the NASDAQ
I do not see how that changes without some type of drastic change in the world. When you think about the Nasdaq 100 and all of the things it has gone through over the last year, yet we find ourselves quite a bit higher, that tells you most of what you need to know. Foreign investment in the United States continues to be relatively strong, so I still advocate buying the dip, but I also recognize that it is going to be a very rocky and volatile road to higher levels.
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