Remember, it’s only a handful of stocks that move the NASDAQ 100, so you should watch out for all the usual suspects like Tesla, Microsoft, Amazon, and Alphabet, plus a few others.
- The NASDAQ 100 initially attempted to rally on Thursday but gave a bank gain as we continue to waver near the 11,600 level.
- It’s a market that’s going to be paying close attention to the payroll numbers coming out on Friday, because the non-farm payrolls announcement has a huge influence on what happens next.
- After all, people worry about what the Federal Reserve will do and whether monetary policy will continue to be tight.
Stocks crash again
In other words, if job numbers are high, people will start to extrapolate that the Federal Reserve will continue to see the need to tighten monetary policy, which runs counter to high-flying tech stocks. Remember, it’s only a handful of stocks that move the NASDAQ 100, so you should watch out for all the usual suspects like Tesla, Microsoft, Amazon, and Alphabet, plus a few others. They need a high growth environment to really get things done, so you only get that when the money is cheap and easy, or the underlying economy is strong.
Traders can continue to ignore the Federal Reserve
If we fall from here, the 11,000 level will be a very interesting area to find support because that’s basically where we’re bouncing from before. If we were to erase this on the downside, it would open the NASDAQ 100 to much lower prices. At this point, I predict the 10,500 level could be a target, followed by the 10,000 level. On the other hand, if we break above the last two day highs, then we could go for the level of 12,000, where the 50-day EMA currently resides. Breaking that down might make me a bit more optimistic, but right now I don’t think that’s very likely to happen.
Yes, Wall Street will find a way to think the Federal Reserve is going to loosen up again, but the reality tells a completely different story, not to mention the people who decide the Federal Reserve are telling a different story. Most of this is because the Federal Reserve has maintained extremely loose monetary policy for 14 years, and they have raised and then tired a generation of traders who have no idea how to design trading stocks without cheap money .
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