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NASDAQ 100 Forecast: Struggling Near 50-Day EMA – 19 July 2022

I believe that Monday was a sharp reminder of just how finicky this market is going to be.

The NASDAQ 100 initially tried to rally Monday but has also failed just above the 50-day EMA. Pulling back the way we have, it does suggest that we are not ready to take off yet, and I’m keeping an eye on the 12,250 level to determine if there’s any real strength. Ultimately, I think this is a market that is probably going to go sideways for a while, so I do favor selling it, but truthfully I think this is more or less range-bound nonsense.

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Looking at this chart, if we do drop I think we could fall to the 11,600 level, which is where we bounced from a few days ago. The market will continue to see a lot of noisy behavior because quite frankly there are people out there that believe the economy is perfectly fine, while others think that we are going to see a lot of recessionary headwinds, and perhaps more negativity. The Federal Reserve is going to tighten rates as much as they need to, and it’s likely that eventually, the technology stocks will continue to show major problems.

The NASDAQ 100 continues to cause some issues, and it’s likely that we will see quite a bit of noisy behavior. The market breaking above the 12,250 level could open up the possibility of a move to the 13,000 level, which is an area where we had both support and resistance at multiple times, and it’s likely that we have significant interest in the market in that area. If we were to break above the 13,000 level, then it’s likely that the market could go to the 14,000 level, perhaps even reaching the 200-day EMA. I don’t see that happening anytime soon, and I believe that Monday was a sharp reminder of just how finicky this market is going to be. After all, the market rallied a bit during the course of the trading session but then gave back those gains to show a severe lack of follow-through. With that being the case, you are probably going to be better off treating a range-bound system, with more of an emphasis on the short side as it certainly has more momentum. In general, this is a market that I think will continue to see a lot of volatility more than anything else.

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