Nasdaq Forecast: Pulls Back but Holds Key Support

• New York has seen a bit of selling on Wednesday, as the NASDAQ 100 has dropped significantly.
• That being said, it does look like we are trying to bounce later in the day, and perhaps do what we can to recover the 25,000 level.
• The 25,000 level of course is a large, round, psychologically significant figure, a lot of people will be paying close attention to and would also get a lot of headlines that have people looking at the stock market in a positive light.

Technical Analysis

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The technical analysis for this pair is still strong, even though we have seen a significant drop during the day. All things being equal, the most important thing that we need to pay close attention to the fact that we have been in a nice up-trending channel for a while, and of course, we also have the 50 Day EMA near the 24,267 level, which is also rising. The uptrend line and channel overall open up the possibility of a move to the upside if we do in fact, drop to that level and bounce. On the other hand, if the market were going to break above the 25,250 level, then I think it opens up the possibility of a big move to the upside.

Keep in mind that there are only a handful of stocks that move the NASDAQ 100, typically thought of as the “Magnificent 7”, so it’s all the usual suspects that you will have to pay attention to get a feel for where we are going next. They have had a tough session during the trading day on Wednesday, but over the longer term, we are likely to continue to see a lot of noisy behavior. but overall, I think you have to look at this through the prism of a market that is likely to go higher.

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