The Nasdaq composite is displaying signs of a trend reversal, having successfully broken through the bearish channel that restrained its price movements for quite some time. This breakout serves as an initial signal that selling pressure is dwindling, paving the way for a further rally. Moreover, the price has also managed to surpass the neckline of a reversal pattern, further strengthening the indication that a bullish trend is taking shape. With the Bollinger Bands starting to point upwards, the potential for a sustained bullish momentum seems promising in the near future.
This breakout is supported by an increase in trading volume, highlighting a rising participation from buyers. Should Nasdaq maintain its position above the breakout level and confirm a new support, the likelihood of an upward movement towards the next resistance level significantly increases. In this scenario, investors and traders should closely monitor the newly established support area as well as other indicator movements to validate the continuation of the bullish trend.
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The Commodity Channel Index (CCI) indicates a positive signal after rising from the oversold area on the 15-minute chart, suggesting that the potential for a trend reversal in Nasdaq is becoming increasingly likely. When CCI exits the oversold zone, it typically signals that selling pressure has diminished and buying is beginning to dominate the market. This condition suggests that Nasdaq could strengthen in the short term, targeting the resistance level of 20,630.
Technical Reference: buy while above 20,325
Potential Take Profit 1: 20,560
Potential Take Profit 2: 20,630
Potential Stop Loss 1: 20,395
Potential Stop Loss 2: 20,325
