Nasdaq 100 Signal: Rises After PMI Results

All things being equal, I think this is a situation where market participants continue to see a lot of volatility but given enough time, I think the overall “buy all the same stocks nonsense” continues.

• The NASDAQ 100 has rallied significantly during the trading session on Wednesday as the PMI numbers in the European Union, the United Kingdom, and of course the United States all disappointed, suggesting that we were going to see a bit of contraction.
• While I think it’s a little early to suggest that perhaps inflation is over, it’s obvious that traders on Wall Street are still looking for that “cheap money.”
• With this being the case, we may see a little bit of follow-through until we get to the Jackson Hole meeting on Friday.

We are above the 50-day EMA, so it does suggest that perhaps we are going to see a little bit of follow-through. At this point, I think the 15,250 level is an area that I think is going to be a barrier that’s difficult to overcome. If and then we get to that level, and perhaps even take that level out, then it’s likely that we could go to the 15,500 level. The size of the candlestick is rather bullish, but I think what we are looking at here is an attempt to recover the longer-term rally. Whether or not the market gets what it wants remains to be seen, but I do think that the speech Jackson Hole is the main event for the week.

Pullbacks at this point should continue to offer buying opportunities, with the 14,600 level underneath being a major support level. I think that as we head into the month of September, more liquidity will come back into the market, and then we might get a little bit more of a believable longer-term move. All things being equal, this is a situation where we continue to see allied volatility, but I do think that the NASDAQ 100 will continue to rise, simply due to the fact that the market continues to pile into all of the same stocks yet again. All things being equal, I think this is a situation where market participants continue to see a lot of volatility but given enough time, I think the overall “buy all the same stocks nonsense” continues. That being said, it’s going to be very noisy over the next couple of days.

Potential signal: The NASDAQ 100 continues to be a leader. I am a buyer here, with a stop at 14950.00, but will then most likely move stop loss to breakeven once we break above the 15250. The target is 15950.

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