The NASDAQ Composite (Nasdaq) is now testing LT resistance levels i.e. its 2000 high. Nasdaq tested this level back in June/July before succumbing to the sharpest fall since 2011.
Will the index see a similar outcome in the coming months?
Our earlier forecast of lower prices failed to materialize (see 28th September issue) as soon as the index took out the critical resistance at 4,961.
Since the breakout, prices have formed a higher high and a higher low, which bodes well for the near term.
The critical support right now is at 4,908 and yesterday’s breakout of the ST resistance trend line from the July highs is positive for the index in the near term.
Taking out 5,163 would put the index on course for a new high with resistance seen around the 5,232-5,250 levels.
IF Nasdaq fails to hold above 4,908, we believe that it is good enough to suggest that the index has once again failed to breakout above the resistance from the 2000 high and more selling could follow next.
In the near term, as long as 4,908 holds, continue to look higher here. (Read Report)
Source : CIMB Research