- The NASDAQ 100 has been all over the place during the course of the month of February, as we have seen a lot of questions asked about the viability of the stock market right now, but quite frankly I believe that the NASDAQ 100 will continue to see buyers on dips.
- After all, the index isn’t even made to fall given enough time, otherwise it would be equally weighted.
- All that being said, the 20,000 level is an important area that we need to pay close attention to, as it is a large, round, psychologically significant figure, and an area that has been important multiple times.
- If we get down to that level, it will obviously attract a lot of attention from a headline perspective, but it’s also worth noting that the 50 Week EMA is right there as well.
All things being equal, I would expect that to be the “bottom of the market” going forward, but we will have to wait to see whether or not that actually holds. As long as it does, I would anticipate that the NASDAQ 100 should continue to be bullish overall.
That being said, if we were to break down below the 20,000 level, then the market could fall apart, but even then, I would anticipate that the market would go looking to the 18,000 level. On the other hand, if we were to break above the 21,000 level, the market could go looking to the 22,000 level. Anything above there could send this market much higher, and it could bring in the “FOMO move” that a lot of people will be jumping into chase momentum. After all, this is an index that a lot of people will be looking for momentum in, especially as the typical “magnificent 7” trader tends to chase that type of action.
The size of the candlestick for the last week of February of course is a sign that the market did get shocked, but when you look at the longer-term trend, it’s obvious that the market has been very bullish for quite some time, and therefore I think you will eventually see traders coming back into express that opinion again.
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