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Nasdaq Rides High on Tech Earnings Buzz

Nasdaq Rides High on Tech Earnings Buzz

Market Overview

The Nasdaq-100 is on a tear, bolstered by upbeat tech earnings and solid economic data that’s got investors feeling bullish. We’re seeing a classic “Goldilocks” scenario unfold—growth that’s hot enough to keep the party going but cool enough to keep inflation worries at bay. Heavy hitters like Amazon and Microsoft have delivered earnings beats, adding fuel to the tech sector’s fire and highlighting resilience in both tech and consumer arenas that dominate the index.

But it’s not all smooth sailing. Rising U.S. Treasury yields—now hitting 4.24% on the 10-year—are throwing a bit of a wrench into the works. Higher yields can spook growth stocks, especially in tech, by upping borrowing costs and making these high-flyers less attractive compared to safer bets. Despite this, the street’s generally optimistic about the Nasdaq-100’s longer-term prospects. With its innovative edge and the Fed likely to step in if things get choppy, investors are eyeing any dips as prime buying opportunities.

Technical Analysis

On the 4-hour chart, the Nasdaq-100 is flexing its muscles, maintaining bullish momentum and hitting its initial target at 20,625.79. This breakout underscores a strong trend, showing the market’s appetite for pushing higher. The index is trading above both its short-term (20,348.36) and long-term (20,439.23) moving averages—a solid uptrend signal. Sitting in the upper half of the Bollinger Bands, the index is showing plenty of volatility and momentum to keep climbing.

Holding steady above the key level of 20,560.70, we’re eyeing the next targets at 20,708.59, 20,800.00, and a stretch goal of 20,947.89. These resistance levels could pose a challenge, but with the current momentum, they’re well within reach. The RSI is clocking in at 63.07, backing the bullish vibe but edging toward overbought territory—so a breather wouldn’t be surprising. The MACD is in positive territory, reinforcing the upward trajectory. With the price comfortably above both moving averages, the bullish outlook gets an extra nod.

Alternative Scenario

If the index slips below 20,560.70, we could see a pullback, potentially targeting the next support at 20,321.40—the previous key low. A move like that would put the brakes on the bullish scenario, at least in the short term.

Key Events to Watch

All eyes are on earnings reports from Microsoft and Meta dropping later today. Traders will be dissecting these numbers for clues on how the tech sector is holding up amidst rising interest rates. Also on the radar are the ADP Employment Change report and U.S. GDP growth data coming out on Wednesday—key pieces that could sway the Nasdaq-100 and the greenback alike.

Key Levels Overview

Resistance Levels:

  • R1: 20,708.59
  • R2: 20,800.00
  • R3: 20,947.89

Current Price: 20,630.25

Support Levels:

  • S1: 20,560.70
  • S2: 20,469.29
  • S3: 20,321.40

Conclusion

The Nasdaq-100 is cruising on a bullish wave, powered by strong earnings expectations and solid economic indicators. As long as it stays above 20,560.70, the path of least resistance is upward. But keep an eye on that level—a break below could signal a correction. Stay sharp; upcoming data releases could shake things up.

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