The Nasdaq100 index bounced from yesterday’s lows, and the price action looks constructive. First, the market formed a bullish divergence with the RSI. Second, it bounced from the dynamic support given by the projected neckline of an inverse head and shoulders pattern. Third, the inverse head and shoulders itself has a measured move that points to new all-time highs.
On top of that, the news out of the United States continues to be rather positive. On the one hand, the economy is bouncing strongly. On the other hand, the vaccination pace reached some incredibly high numbers. Combined, the two are enough to push the U.S. economy on a strong recovery track.
Moreover, the new round of fiscal stimulus that has just been sent by the Biden’s administration will help households during these difficult times and ensures funds are available for vaccine deployment. Furthermore, an infrastructure bill is on the table, worth over $3 trillion, designed to finance long-term projects in the United States. No matter how you put it, this is bullish the U.S., hence bullish the stock market.
Nasdaq100 Technical Analysis
Aggressive bulls may want to go long at market with a stop at the lows and target the measured move of the inverse head and shoulders pattern. Conservative traders, on the other hand, may prefer to wait for the market to break above the neckline before going long for the same target.
Don’t miss a beat! Follow us on Telegram and Twitter.
Nasdaq100 Price Forecast
More content
- Download our latest quarterly market outlook for our longer-term trade ideas.
- Follow Mircea on Twitter.
- Do you enjoy reading our updates? Become a member today and access all restricted content. It is free to join.