Can the Nasdaq 100 Break-Out to New Highs?

Since the Treasury market bottomed in late October, the Nasdaq has experienced a robust surge of over 10%. As we approach the year-end, there's increasing speculation regarding the potential timing of an interest rate cut by the Federal Reserve. While Mega-Cap Tech stocks have dominated headlines throughout the year, a noticeable shift in the narrative is underway as we enter 2024. Traders and investors are reallocating from tech to more cyclical sectors of the market.

Sell Tech and Buy BTC and Small Caps?

Recent trends underscore this shift, particularly in the outstanding outperformance of BTC, ETH, and the Russell 2000. December 4th marked a significant day, highlighting a substantial repositioning by investors. The Russell closed the day positively by more than +0.9%, while the Nasdaq 100 experienced a decline of over -1%. Currently finding support at the 21-Day EMA, the Nasdaq 100 remains a focal point, with the key level to monitor in the near term being the clearance of the major resistance zone of 15950-16100 for a potential retest of all-time highs.

Major Headwinds for the Nasdaq 100:

This week introduces a flurry of Jobs data, presenting a significant headwind for the Nasdaq 100, coupled with considerations of interest rates. According to the CME FedWatch tool, there's a 58% probability of a rate cut in March. To witness further upside, confirmation of labor market weakness and an increase in interest rate cut probabilities for the March Fed meeting are essential.

Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have
futures in your trading portfolio, you can check out on CME Group data plans available that suit your
trading needs tradingview.com/cme/

Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/

Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/

*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.

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