Nasdaq 100’s Current Consolidation Could be Historically Conceived

Nasdaq 100’s Current Consolidation Could be Historically Conceived

The Nasdaq 100 (NDX) has lost its title as the most consistent price gainer in the equity space, following a displacement of volatility and a rotation in sectoral demand. The tech-heavy index has climbed by about 7% in its month-to-date standings. However, the Dow Jones (DJIA) and the small-cap Russell 2000 index have grown by about 11% and 18%, respectively, in the same period.

As a result, the NDX to DJIA ratio has fallen close to its lowest point in the past five months, indicating the shift in investor interest. Regardless, the overall outlook of all US indices remains on the upside.

The recent announcements of potential COVID-19 vaccines most likely played determining roles in the shift in investor interest across sectors.

However, a crucial unrecognized factor also playing a role in the recent sectoral switch is seasonality.

Apparently, since 1980, October has always been the highest-volatility period on average—based on measurements from the VIX—with subsequent months witnessing a steady decline in panic by investors. That said, the last two months of the year have always been very positive for the Nasdaq 100, Dow, and S&P 500 (SPX) for the past four decades. With this, it could mean that the slowdown seen in the NDX could be a replay of history.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — November 24

NDX Major Bias: Sideways

Supply Levels: 12040, 12200, and 12439.

Demand Levels: 11800, 116507, and 11307.

The NDX has remained in a tight consolidation range between 12040 and 11800 for the past two weeks now. With no direction in mind for the meantime, the NDX might fall under the sway of new developments surrounding the COVID-19 pandemic and tomorrow’s FOMC meeting minutes.

Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

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Nasdaq 100 Gets a Boost as US Lawmakers Resume COVID-19 Stimulus Talks

Nasdaq 100 Gets a Boost as US Lawmakers Resume COVID-19 Stimulus Talks

US equity indexes closed higher on Thursday, as investors’ market confidence got revitalized following mentions of Washington lawmakers coming back together to pass a Coronavirus fiscal stimulus package to ease the pandemic-induced economic crisis.

The Nasdaq 100 (NDX) rose by 90.72 points or (0.76)and closed at 11985.43, while the Dow Jones (DJIA) and S&P 500 gained 0.36% and 0.39%, respectively.

As mentioned earlier, yesterday’s rally was sponsored mainly by the revived COVID-19 stimulus talks, as the virus continues to ravage the US. at press time, there are 12 million infection cases in the US, with a tragic 258,363 recorded deaths.

Senate Minority Leader Chuck Schumer, Democrat-New York, noted that Senator Mitch McConnell, Republican-Kentucky, had acceded to renew talks on a new COVID-19 aid package relief. Before this point, Democrats and Republicans in Congress could not agree on a suitable size and scope of a potential stimulus bill.

That said, the recent breakthrough was seen as a very positive development and boosted market mood. However, investors remain cautious, as many of them trooped back into large-cap tech-related stocks that thrived in the previous lockdown period.

That said, Wall Street is expected to see some choppiness in the coming sessions as investors monitor fresh Coronavirus developments closely.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — November 20

NDX Major Bias: Bullish

Supply Levels: 12070, 12200, and 12439.

Demand Levels: 11890, 11650, and 11307.

Although the sentiment surrounding the NDX is upbeat, the index remained within a consolidation range between 12070 and 11770 over the past week.

Meanwhile, the index is trading within a wedge, providing expectations of a sharp breakout—most likely to the upside—soon.

Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

 

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Nasdaq 100 Price Analysis — November 17

Nasdaq 100 Price Analysis — November 17

The Nasdaq 100 (NDX) traded on a positive note through Monday and is likely to resume its bullish journey in the North American session on Tuesday.

The index has started this week on a very positive footing, as market participants expect a replay of last week’s bull run in yet another COVID-19 vaccine-related development.

The refreshed market risk appetite got sponsored by reports that one of the world’s leading drugmakers, Moderna (NASDAQ: MRNA) had manufactured a very effective COVID-19 vaccine. This news is coming just under a week after Pfizer (NYSE: PFE) reported a 90% effectiveness rate in its vaccine candidate. This week, Moderna announced that its phase three trial vaccine showed a 94.5% effectiveness in preventing the virus.

Notably, the bullish gaps between the S&P 500 (SPX) and other major indexes were significantly slimmer this time around, compared to the November 9 rally.

Another similarity to last week’s price action is the slide in the NDX relative to the Dow Jones (DJIA) and SPX. This observation could be a sign of a lift in global risk trends or a quelling of the uninformed speculative appetite seen over the past few months.

Regardless, a second successful vaccine against the disease responsible for the global economic crisis is a very positive development for the global economic recovery.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — November 17

NDX Major Bias: Bullish

Supply Levels: 12220, 12439, and 12600.

Demand Levels: 11890, 11650, and 11307.

The NDX maintained its bullish momentum into the second day of the week, as our technical indicators project subsequent climbs. The index is currently trading within a wedge, and a sharp breakout to the upside seems imminent. We expect a retest of the 12220 resistance in the short-term, after which the 12439 ATH comes into contention.

Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

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Nasdaq 100 Picks Up Bullish Steam as COVID-19 Vaccine Optimism Wanes

Nasdaq 100 Picks Up Bullish Steam as COVID-19 Vaccine Optimism Wanes

The recent market shift away from the tech sector into traditional value stocks following the positive COVID-19 news could be short-lived. Investors have trooped into value stocks after a COVID-19 vaccine being developed by Pfizer showed 90% effectiveness against the novel disease. This bolstered companies with a traditional business model, especially at a time when the US is recording more than 100,000 Coronavirus cases daily.

However, with the vaccine requiring a strict storage temperature of -70 degrees Celsius and two doses required to effectively inoculate the receiver, there is a decent chance that the distribution of the much-needed vaccine will be limited. This could affect the current sectoral rotation and pour capital back into the tech sector.

Meanwhile, the possibility of stricter lockdown measures under a Biden administration could re-establish a premium on tech stocks. The tech-heavy Nasdaq 100 (NDX) has greatly outperformed its index counterparts since the March crash, climbing 88%, while the S&P 500 (SPX) and Dow Jones (DJIA) climbed by 65% and 64% respectively.

That said, the prevailing fundamental factors could continue to aid the Nasdaq 100 index and tech stocks in the near-term.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — November 13

NDX Major Bias: Sideways

Supply Levels: 12000, 12220, and 12439.

Demand Levels: 11650, 11307, and 11000.

The NDX has recovered from its recent descent, as it was immediately saved by the 11500 support. At press time, the NDX is trading at 11920, a few points below the critical 12000 pivot point (pre-market data). That said, we should expect a retest of the 12100 -12200 area, as fundamental factors continue to favor the index.

On the flip side, failure to clear the 12000 psychological area could open the door to a retest of the 11650 area.

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Positive Vaccine Development to Send the Tech-Heavy Nasdaq 100 on a Downward Spiral

Positive Vaccine Development to Send the Tech-Heavy Nasdaq 100 on a Downward Spiral

US equity markets went into a frenzy on Monday, following positive results and reporting of a COVID-19 vaccine candidate by Pfizer (NYSE: PFE). The company’s mRNA technology-based vaccine showed a 90% effectiveness result in an initial phase 3 clinical trial. The result was largely better-than-expected, although there are worries that its effectivity could depreciate as the sample size grows. Nonetheless, the market risk tone was heavily stimulated by the report.

Crude oil prices spiked by about 8% before retracing in the late trading hours yesterday. Gold (XAU/USD) fell by more than 5% as hopes for further fiscal stimulus faded.

An effective and readily-available vaccine will be a major game-changer across the financial markets. With a vaccine, business activities are likely to increase dramatically, cutting down reliance on digital facilities. The recent rally in the energy, finance, and industrial sectors alongside the fall in the tech sector like tech-heavy Nasdaq 100 (NDX) paints a good picture of what is to come.

A strong rebound in the demand for travel, tourism, leisure, luxury goods, restaurants, and traditional retail is expected. While demand for digital services may remain, it is likely to be on the lower end. That said, investors appear to have made a significant switch from big tech stocks into the long-underperforming traditional industries last night, highlighting a change in sectoral rotation.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — November 10

NDX Major Bias: Bearish

Supply Levels: 11890, 12000, and 12220.

Demand Levels: 11650, 11307, and 11000.

The NDX has come under intense pressure, following the drastic shift in market risk tone. That said, we expect to see further declines in the index’s price soon. Expect to see the NDX hit the 11307 support in the coming hours or days.

On the flip side, the NDX could stall a bit or climb higher, but a break above the 12000 seems very unlikely at this time.

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Nasdaq 100 Price Analysis — November 6

Nasdaq 100 Price Analysis — November 6

The US stock markets saw a sharp reversal in the early trading hours on Friday, following a strong rally pushed the Nasdaq 100 (NDX) up by more than 11% this week alone. This surge was likely as a result of more investors betting on a split Congress, which would forestall any major industry policy changes.

The outcome of the election is yet to be decided upon, but it appears that Joe Biden is now closer than ever to securing 270 votes in the Electoral College that determines the winner as he flips Georgia.

Meanwhile, incumbent President Donald Trump has launched a series of smear campaigns against the country’s democratic process from the White House and over a series of tweets, as he claims that the election was “stolen” from him.

Matt Sherwood, Head of Investment at Perpetual in Sydney, has remarked that the markets have already priced in a Biden win and a politically-split Congress. He added that the markets can get all of the good parts about a Biden presidency including stable leadership and foreign policy, without any of the far left aspirations like increased taxation.

That said, the prospect of a policy stalemate in Washington eased worries about a stricter regulation on the Big Tech companies.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — November 6

NDX Major Bias: Bullish

Supply Levels: 12100, 12220, and 12439.

Demand Levels: 11890, 11650, and 11307.

Following a very powerful performance over the week, the NDX has regained its bullish momentum and will likely go on to clear a new all-time high. That said, we might see a little retrace to the 11890 – 11700 level, where bounce will likely occur and take the NDX to higher levels.

Meanwhile, the results of the elections (which could likely be finalized today) is the main event to look out for clues.

Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

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Nasdaq 100 Price Analysis — November 3

Nasdaq 100 Price Analysis — November 3

The Nasdaq 100 (NDX) was the worst-performing major US index on Monday, as the technology sector continued on its weakened sentiment.

While the recent weakness in the industry is regarded as a crucial bearish factor for the NDX, a bigger reason for the slump in the index is due to investors taking flight from riskier assets ahead of the US Presidential Election today. Subsequently, market participants will be observing the central bank’s decision and jobs data later this week.

That said, it’s worth considering if the weakness in the tech sector will continue after the election or if this is just a retrace before a continuation upwards.

Meanwhile, the ratio between the Nasdaq 100 and the Dow Jones (DJIA) has gotten weaker over the past few trading sessions. This was like as a result of the displacement caused by the Coronavirus-induced crisis in the equities market. In the pandemic, tech stocks saw a boom, while the components of the Dow were not favored as much.

Traditional stocks on the Dow like Boeing (NYSE: BA), Caterpillar (NYSE: CAT), and Goldman Sachs (NYSE: GS) came under intense pressure as stocks like Zoom (NASDAQ: ZM), Peloton (NASDAQ: PTON), and Netflix NASDAQ: NFLX) flourished.

However, polling data suggests that Biden will likely emerge as president, which may strengthen the ratio between the Dow and Nas100 as tax hikes in the tech sector and infrastructure spending become possibilities.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — November 3

NDX Major Bias: Bearish

Supply Levels: 11307, 11560, and 11650.

Demand Levels: 11000, 10720, and 10511.

The NDX remains in a strong downward spiral since its 12220 high on the 12th of October. Meanwhile, it appears that the index has found strong support at the 11000 psychological levels, following several failed attempts to break below. Not so surprisingly, this level coincides with the base of our descending channel, indicating that we could see a bounce to the 11307 resistance soon.

Regardless, near-term price action across markets will likely be dictated by the outcome of the US Presidential Election in the ensuing hours and days.

Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

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Nasdaq 100 Price Analysis — October 30

Nasdaq 100 Price Analysis — October 30

The Nasdaq 100 (NDX) traded on a positive momentum yesterday, as risk appetite began to creep in across markets following the dramatic sell-off on Wednesday. The NDX could be well on its way to a volatile session today following several earnings reports from tech giants like Apple (NASDAQ: AAPL), Facebook (NASDAQ: FB), Alphabet (NASDAQ: GOOG), and Amazon (NASDAQ: AMZN).

On aggregate, the tech behemoths posted strong earnings figures, especially considering the COVID-19 economic crisis backdrop. All four companies posted better-than-expected earnings and revenues. However, hours after these figures dropped, Amazon and Apple stocks have seen negative price action so far; Facebook remains almost unchanged, while Alphabet climbs higher.

Big-4 Earnings Report

Apple recorded significant growth in its Q3 figures and made a record-breaking revenue of $64.7 billion. However, the recent weakness seen in Apple stock performance is likely as a result of the weaker-than-expected iPhone sales this year.

Amazon reported strong Q3 figures with $12.37 per share post-dilution, trumping estimates. The company also recorded a staggering $96.1billion in revenue.

Alphabet Inc. recorded a strong $38.01 billion in quarterly revenue, beating estimates of $35.35 billion. An Alphabet executive stated that this revenue jump was as a result of increased advertiser revenue across its search and YouTube platforms.

Facebook’s active daily users’ number, a key metric used by investors to evaluate the company, was at 1.82 billion in September, a 12% YoY spike. However, the company expects significant uncertainty in its numbers next year.

It will be interesting to see how the index reacts to all these amid the growing US political tensions and the second wave of the virus ravaging the globe.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — October 30

NDX Major Bias: Bullish

Supply Levels: 11495, 11560, and 11890.

Demand Levels: 11307, 11000, and 10680.

The Nas100 appears to be recovering from the brutal sell-off from two days ago. However, the index was met with fresh bearish pressure at the 11495 resistance earlier today—based on pre-market data. Although uncertainty is ruling the market at this point, we should expect a decent bullish price action today.

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Nasdaq 100 Price Analysis — October 27

Nasdaq 100 Price Analysis — October 27

The Nasdaq 100 (NDX) traded with a good amount of volatility at the start of the week amid growing COVID-19 cases and dwindling hopes for a US fiscal stimulus package, which thwarted risk appetite.

Meanwhile, a downtrodden outlook and quarterly report for Germany’s largest software company, SAP has added to the gloomy sentiment surrounding the NDX, ahead of what can be regarded as the most important period for the tech-heavy index. In the coming days, big-tech companies will be reporting their earnings, which could create massive volatility for the index ahead of the US Presidential election.

All this volatility-inducing events make for an explosive reading period for the Nasdaq 100, especially at a time when the VIX is inflated. That said, correctly predicting the directional bias of the NDX will be very difficult.

Nonetheless, the Nasdaq will be dictating market sentiment in the days ahead, giving the index’s technicals more importance.

As the high-profile earnings drop in the coming days, investors will start to see a more vivid image of what the NDX could do next. Until then, predicting a clear-cut bias for the Nasdaq is near impossible.

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — October 27

NDX Major Bias: Bearish

Supply Levels: 11650, 11890, and 12000.

Demand Levels: 11307, 11000, and 10680.

The NDX has traded on a strong bearish bias for the seventh consecutive session now, amid the growing political tensions in the US and the growing coronavirus infection globally. The index has been steadily trading below our descending trendline since its 12204 high on the 12th of October. That said, we should expect further declines to the 11307 support and possibly below.

However, it is advisable to remain on the sidelines, given the uncertainty plaguing the market.

Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results

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Nasdaq 100 Price Analysis — October 23

Nasdaq 100 Price Analysis — October 23

Wall Street traded on a choppy sentiment on Thursday, as investors’ mood was lifted by the prospect of additional fiscal stimulus to bolster the pandemic-torn US economy amid reports pointing to a slow-down in the labor market recovery.

This week, Wall Street traded at the mercy of reports surrounding stimulus talks. The CBOE Market Volatility Index (VIX) increased for the eighth time in the ninth consecutive session and was last spotted at +2.8%.

Meanwhile, the final debate between US President Donald Trump and his Democratic opponent Joe Biden on Thursday provided little surprises for election watchers but reinforced investors’ caution ahead of the November 3 elections.

While Biden plans on increasing taxes on corporate and capital gains if he becomes president, the pledge by Democrats to provide large stimulus reliefs is regarded as a decent compromise to the tax increase.

Also, the ‘green’ energy sector will be a potential winner against traditional energy firms under a Biden presidency. The Dow Jones (DJIA) oil and gas sector is currently at -49% YTD. Biden reaffirmed that his presidency will usher-in net zero-emissions by 2050.

Meanwhile, the Nasdaq 100 (NDX) has also lost about 1.4% this week alone on the worries of the Democrats’ hard stance on big tech firms. That said, investors could decide to cash-out their profits before any increase in capital gains tax. 

NDX – 4-Hour Chart

Nasdaq 100 (NDX) Value Forecast — October 23

NDX Major Bias: Bearish

Supply Levels: 11890, 12000, and 12220.

Demand Levels: 11307, 11000, and 10680.

The NDX remains under an intense downwards bias as the US Presidential election draws near. The index has now traded on a consolidation pattern for the fourth consecutive session, as it continues to descend with our downward-facing trendline. 

Meanwhile, this bearishness is likely a reprieve from the recent entry into overbought territory on our 4-hour MACD indicator. In the meantime, the index is likely to continue on its current consolidation. 

Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.

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