Introduction: 💬 Tech has been in a non-stop uptrend within an uptrend channel as seen on this NASDAQ (NAS100USD) chart. While COVID has been rough in general for traditional businesses and the dollar, tech has had the unique fortune of benefiting from the recent stimulus fueled low-rate lockdown. With this strength in mind, and with top sector companies like Apple on the verge of hitting $2 trillion and continued weakness in the dollar, we think the NASDAQ has room to run while the market continues to favor risk-on tech companies and even assets like crypto. So then, will the NASDAQ test the top of the channel, perhaps on news that Congress has passed stimulus? Let's take a look.
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Support:
S1: This current ranges swing low which left us a short term Orderblock down there, expecting it to provide support if do see any downside short term.
S2: Upon seeing a breakdown outside of the bottom trendline, a retest of this S/R flip + Orderblock is quite reasonable. We will see how the market reacts to that much of a deviation from this current uptrending channel when we get there though so hold tight bulls.
Resistance:
R1: This short term Orderblock is likely to be tested soon if not while this writeup is put out. Don't hold your breath expecting this to hold any significant move down. Breaking above this R1 would lead to keeping an eye on the top of this upwards channel we continue to see respected.
Market Breadth:
Tech: As you can see, Technology as a whole is bullish here. This is a positive signal for the NASDAQ and implies an ability to move higher.
USD: The continued weakness in the dollar bodes well for the current uptrend in tech to continue. It is hard to justify sitting in low yield savings accounts with a weak dollar versus the hefty returns in the ultra bullish NASDAQ.
Crypto: Crypto has been bullish recently. Crypto is a risk-on, tech asset, and "safe haven" like Gold. Its continued strength also bodes well for the NASDAQ to continue its uptrend.
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Summary: All signs point to the NASDAQ uptrend continuing, however after forming such a clean channel a decisive break in either direction will be something to take seriously. If the bottom falls out and S2 can't hold, it could be time for a major correction. If we somehow break out to the upside, hold onto your hats, because the Moon is the limit.
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Kommentera
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Since the scaling has rearranged the orientation of some aspects upon uploading this idea I will be posting a screenshot of the original here for the viewing pleasure of everyone. This scaling issue is a constant battle :(
I Love the Fear vs. Greed indicator and it's accuracy and all these bullish comments along with a 75 reading on the greed indicator tells us we're nearing a top followed by a painful drop. I'll be the first to admit it's been a nice run, but when this train derails it's gonna be ugly IMO.
AlphaBotSystem
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@z3m25, Thanks for the comment, I do agree that we could see some downside but only time will tell.
Robinmike
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Hi There,
Pls keep me updated if that is possible.
Many Thanks
Mike
AlphaBotSystem
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@Robinmike, Hey Mike thanks for the comment! We may more than likely consider doing a new writeup going forward since this one had its visual orientation a bit messed up :P
Excuse me guys, new to this platform. How do I adjust the default line price into candlestick formation? I've been trying to find in the chart. Thanks for any help.
AlphaBotSystem
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@limitlessFranxis, I can give you some info about it but in the future people's Idea's are not the best place to ask these kinds of questions 😆
Excellent write-up. i will definitely consider the market-breadth indicator in future plays, especially equities.
AlphaBotSystem
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@maxjrux, Appreciate the positive feedback! The Market Breadth Indicator comes with an Automated Sector Detection so be sure to read the documentation when you are first trying it out. :)
scheplick
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I like how the you made the NAS100USD look like a TikTok :)