(MENAFN- Daily Forex) The nasdaq 100 rallied a bit in the futures market on Thursday, in what would have been very thin and limited trading. After all, it was Thanksgiving in the United States, but one only must look at the events of the last couple of weeks to see that something may be changing, at least for the short term.
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You can make an argument for a bullish flag now, and there has been very little to work against that theory. The 50-Day ema sits just below the flag itself, so that should offer a bit of support near the 11,500 level. While I am not a huge fan of owning stocks right now, because quite frankly I don't think that the economic situation warrants it, there may be a short-term trade to the upside, even in technology stocks, even though interest rates are extraordinarily high compared to the last 14 years.Uptrend is Limited
When you look at this chart, you can see that the 12,000 level has offered a significant amount of resistance, so if we can break above there, then it's likely that we could continue to go to the 200-Day EMA, which is near the 12,500 level. On the other hand, if we turn around and break down below the 11,500 level, then we could see the NASDAQ 100 drop, perhaps down to the 11,000 level. Keep in mind that Wednesday had the FOMC Meeting Minutes come out, and a lot of traders will have read into that the ability of the Federal Reserve to perhaps slow down rate hikes. There's a lot of questioning of where we go next with interest rates in the United States, but right now people are starting to bet on the idea of only 50 basis points in December, and perhaps sitting still after that.
It is because of this that I think the uptrend is probably somewhat limited because it's likely that Jerome Powell will continue to sound as hawkish as he can, and that might be reason enough to start shorting again. All things being equal, this is a market that looks like it's got a short-term bounce in it, but I don't know that I would hang onto it because we have tough economic situations going forward, but some traders are starting to bet on the fact that perhaps the market has already priced in the entire recession.
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