An increase in the Building Permits and Housing Starts this afternoon is one of the main factors spurring a push to new record highs for the Nasdaq 100 index. The Nasdaq 100 is trading 0.55% higher at 11356.4, which is just shy of the new all-time highs posted today at 11386.9, as Building Permits and Housing Starts came in at 1.50 million each. These figures were far better than the 1.26 million and 1.22 million (an upward revision) posted last month, and also exceeded estimates of 1.33 million and 1.23 million respectively.
The data published by the Census Bureau indicate that there was an overall rise in housing starts across all measured regions of the US, irrespective of the rise in coronavirus cases seen since July 2020.
The Building Permits/Housing Starts data is becoming increasingly important as a record number of Americans (about a fifth of the 110 million renters according to the Aspen Institute) are facing eviction by September if there is no support coming from the enhanced stimulus. Stimulus talks are currently deadlocked, but an increase in those buying newly built homes or getting permits for new homes shows a dynamic shift from the rent economy that took hold of the US in 2008, to the homeowner economy that preceded that era.
The markets are loving it, and this is manifesting as demand for Nasdaq-listed shares.
Technical Outlook for Nasdaq 100
The index continues to trade within the ascending channel, which has for the past three months been the guiding light that has taken the Nasdaq 100 into record territory. 11453.2 remains the price level to beat for bulls, as it is the 300% Fibonacci extension from the 10 March to 23 March swing move. The same price move produces possible upside targets at the 327.3% extension at 11887.1 and the 341.4% extension at 12113.6. These may be the new targets if the Nasdaq 100 can break the 11453.2 price level.
On the flip side, a rejection at 11453.2 allows for a pullback and possible retest of 11176.3, with 10866.5 and 10505.4 constituting downside targets that are only attainable on a breakdown of the channel.
Nasdaq 100 Daily Chart