nasdaq 100 index

Nasdaq 100 Opens Higher As Microsoft Launches Bid to Buy TikTok

The Nasdaq 100 composite index has opened higher on this first trading day of August 2020 as U.S. President Donald Trump has given his approval to the bid by Microsoft to buy the controversial app TikTok. President Trump has given Microsoft a 45-day window to complete the acquisition of the U.S. operations of TikTok, an application that the U.S. has deemed to have vulnerabilities that pose national security risks. However, the news is not going down well with China, and especially with one of the Chinese investors in the application, Bytedance, which has roundly condemned the move.

There are indications that the U.S. action against TikTok could be one of several that could come up down the road against Chinese-owned interests. In a Fox News interview on the “Sunday Morning Futures” program, U.S. Secretary of State Mike Pompeo hinted at further actions on US-based Chinese tech companies by the Trump administration. Pompeo alleged that these companies were spying conduits that were feeding information to the Chinese Communist Party.

The Nasdaq 100 composite index is also benefiting from positive sentiment in the U.S. market as expectations for the passage of a new stimulus bill by the U.S. congress heighten.

The US ISM manufacturing PMI data is due for release shortly. The outcome could determine the direction of the Nasdaq 100 index on the day as the market kicks off trading for the month. Highlights for the week include their initial jobless claims data which has recently started to tick upwards as well as Friday’s big news event, the non-farm payrolls data.

Technical Outlook for Nasdaq 100

The Nasdaq 100 is trading at 11072.3, which is a new record for the index as it chases the upper border of the ascending channel. A successful close above the previous all-time high of 11069 could allow the Nasdaq 100 to aim for 11453.1, which is the 300% Fibonacci extension from the 10 March to the 23 March swing move. This is also where the upper border of the channel intersects the horizontal price level.
On the flip side, failure to clear the resistance formed by the previous all-time high could allow for a pullback towards 10866.5, with a breakdown of the channel’s lower border making room for price to target 10505.4, 10307.3 and 10156.5, depending on the strength of such a decline.

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Nasdaq 100 Daily Chart

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