Nasdaq 100 Rally Expected
Dr. Arnout ter Schure | Sep 02, 2022 07:54AM ET
Two weeks ago, see here, I was tracking a possible bullish setup for the Nasdaq 100: five waves higher as per the Elliott Wave Principle (EWP) from the June low.
Last week, see here, with the Nasdaq at 12900s, I found the index should rally back to around 13400+/-100 and then target around 12500+/-100 for a potential 4th wave low. The "must hold level" for the Bulls.
Last Friday, the index reached 13175 and today traded as low as 12013. Thus, my foresight for a bounce and drop was correct. However, the bulls failed to hold 12400 and are now staring at a critical overlap with the high made in June. See Figure 1 below. In my initial article, I had labeled it objectively as (green) wave-1/a because the market had not proven either wave label. Today it did, and that high is now marked as (green) wave-a. Subsequently, this labeling has ramifications for the intermediate- to long-term: see, for example, my article about a multi-year Bear market here.
Figure 1. Nasdaq 100 daily candlestick chart with detailed EWP count and technical indicators
Due to the overlap, I am now tracking for an impulse lower instead (grey waves i, ii, iii, iv, v) per the ideal 3rd, 4th, and 5th wave Fibonacci-based target zones. See Figure 1 above.
Today's reversal candle suggests wave-iii completed, and wave-iv should now be underway, targeting ideally 12400+/-100. The index should not move above last week's low of around 12900, or it would invalidate this possible impulse path. Once wave-iv completes, wave-v should ideally target about 11400-11600. At that stage, several more extensive options/paths are available to the market, which I will discuss then. But a more substantial rally from these lower levels is, for now, expected.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.