- During the trading session on Tuesday, we saw the NASDAQ 100 rally a bit, as we continue to see plenty of upward momentum in general.
- After all, the NASDAQ 100 had been sold off quite drastically, and it’s worth noting that during the Monday session, we saw the market break above the 200 Day EMA and continue going higher, but one would have to ask the question as to how much longer we can rally.
- After all, not that much has changed other than the fact that the NASDAQ 100 got far too oversold.
One of the biggest factors that you have to keep in mind is that recently we have seen Donald Trump suggest that the tariffs could be targeted instead of broad-based, so people have use that for an excuse to start buying stocks again. Whether or not that will continue to be the case going forward remains to be seen, but for me, it’s still a little bit early to get overly aggressive about going into this market and buying contracts.
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Technical Analysis
The technical analysis has drifted a bit as we are now above the 200 Day EMA, but all things being equal, the market is likely to continue to look to the 20,400 level. If we can break above that level, then it’s likely that the market will go looking at the 50 Day EMA. However, not enough has changed for me to believe that the selling is over. This could just end up being a “bear market rally”, something that you will get from time to time when a market has been sold off as viciously as this one has been.
On a breakdown below the 20,000 level I suspect that the NASDAQ 100 could start to drop at this point, perhaps reaching out to the 19,600 level, maybe even as low as the 19,129 level, which was the swing low. Because of this, I am essentially in an area where I have closed the little bit of long positions that I had, and now I’m waiting to see whether or not things shake out with a bit more clarity.
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