Magazine article Modern Trader

Tech Talk: Nasdaq's Breakout Points

Magazine article Modern Trader

Tech Talk: Nasdaq's Breakout Points

Article excerpt

Based on current Gann and Elliott wave analysis through the end of 2001, the key points for the Nasdaq Composite index are 2280 and 1980. This suggests you should be long above 2280 with a stop at 1980; be short if the Nasdaq crosses below 1980.

The Nasdaq should move up further if it crosses above 2420. As the chart shows, our current Elliott wave labels suggest a target of 1400-1450 on the downside.

The weekly chart, used to view three to 12 months ahead, is nearly overbought but not quite yet. This backs up our theory that the Nasdaq is likely to move higher, up to around 2800, and then possibly downward from there to test the lows from March 2001. Expect a possible move back up to 3000 by year-end if, and only if, the market can test the lows from March and companies can start producing in-line earnings reports without lowering earnings expectations. This should start to happen in the fourth quarter of this year. …

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