Nasdaq 100 Back On the Path Towards 11600 As US President Trump Improves
The Nasdaq 100 index is up today on the back of several positive news this Monday. The ISM Services PMI surprised to the upside, rising to pre-pandemic levels as it clocked 57.8 (versus the 56.3 consensus and 56.0 previous numbers), indicating a recovery in the services sector of the economy.
Other news boosting the index include the positive updates on the health of US President Donald Trump, which is said to have improved to the point where doctors are considering a Monday discharge. However, several of his close staff continue to contract the coronavirus, with the WH Press Secretary Kelly McEnany announcing her positive diagnosis earlier today. Ahead of the VP debate later this week, VP Mike Pence continues to test negative despite his exposure to the President and several other staff who are now positive. However, markets remain focused on the President and so far, optimism looks high on the upbeat prognosis issued by doctors at the Walter Reed Medical Centre.
Further boosting sentiment is the performance of the biotech stocks on the Nasdaq 100. Regeneron saw its stock price soar by 7.21% on Monday after the administration of the company’s investigative cocktail for the treatment of the coronavirus, REGN-COV2. The drug remains in clinical trials and is not yet approved by the FDA for widespread use. Several biotech stocks such as MyoKardia Inc, Artelo BioSciences, Eidos Therapeutics, Corvus Pharmaceuticals and Humanigen Inc, are all seeing double-digit gains on the day.
The Nasdaq 100 is currently up 1.6%.
Technical Outlook for Nasdaq 100
The Nasdaq 100 saw the completion of the double bottom pattern last week but suffered a pullback on Trump’s coronavirus diagnosis.
Today’s positive news have led to a bounce on the neckline, thus opening the door to possible furtherance of the advance on the index. 11567.6 and 11974.1 are the immediate upside targets, followed by 12003.6. The all-time high at 12467.8 remains intact but could be challenged if the index maintains the upward trajectory for the rest of the week.
On the flip side, a decline on the index could follow a drop below 11176.3, which also takes the Nasdaq 100 price bars below the neckline of the double bottom pattern. Further decline could then target 10866.5, with 10760.8 and 10505.4 lining up as potential targets down south.