Nasdaq Forecast Today 16/05: Rebounds After Dip (Chart)

(MENAFN- Daily Forex)

• NASDAQ 100 initially fell during the session on Thursday but has seen buyers jumping back in order to push the market back toward the highs of the previous session by the time we got to midday New York trading.
• Ultimately, this is a market that of course is overdone in the short term, but perhaps it was overdone to the downside previously, and this might be what we are seeing, an attempt to return to balance.

All things being equal, this is a market that obviously will lead the way back up, as we have seen over the last couple of weeks, and the fact that the market recovered so nicely during the session suggest that perhaps we still have plenty of underlying business to deal with. The market is likely to continue to look at pullbacks as potential buying opportunities, and after the session on Thursday, it's very likely that we could see the 21,000 level as a major short-term floor in the market.

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The technical analysis for the NASDAQ 100 is obviously very bullish, but it is a little bit overdone at this point in time and overextended. Ultimately, while we could use a bit of a pullback, we may not get that and may just simply get more sideways action in order to work off some of the froth, which is a sign of a very strong market, and over the longer term is probably the best signal for continuing bullish behavior.

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Nonetheless, when you look at the moving averages, you also have the 50 Day EMA getting ready to cross above the 200 Day EMA, which sits just below the crucial 20,000 level. The 20,000 level obviously has a lot of psychology attached to it as well, so I think before we kick off the“golden cross”, there are plenty of other reasons to get long anyway. The 22,000 level at this point time it looks to be the ceiling that everybody is trying to aim for.

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