NASDAQ Rising But Looks For More Cut Clues – NASDAQ Analysis & Prediction 

Key Points

• The NASDAQ is lining up a third consecutive week of gains but remains off the all-time highs. 
• With a slower news cycle this week, no news could be good news for risk assets, with stocks looking to Fedspeak for more cut clues. 
• Expect a livelier end to the week, with US Core PCE and GDP in focus.
• NASDAQ looks prime to break out above 20,000 as it closes in on August’s high. 

Market Overview 

After a turbulent summer, it looks as though the NASDAQ will (just about) end on top. The price is currently closing in on August’s high at 19,940 and looks ready to break out above 20,000 in the coming days. If it can end this week as it has started, this would be the third consecutive week of gains for the popular tech index.

However, the mood around tech stocks still remains relatively cautious, with the index trading 800 points away from its all-time high of 20,757. In comparison, the S&P500 and US30 have exceeded all-time highs, which is a representation of the more defensive approach to the NASDAQ at this moment in time.

Markets Look To Fedspeak For More Cut Clues

With the markets experiencing a slower news cycle than last week, the bulk of the action could come from multiple Federal Reserve members speaking over the next five days. Yesterday, the Chicago Fed President Austan Goolsbee said, “Over the next 12 months, we have a long way to go down to get the interest rate to something neutral so we can try to hold the conditions where they are.” This has fuelled the excitement of more jumbo hikes on the way.

On Thursday, the markets will hear comments from ten FOMC members, including the Chair, Jerome Powell. Traders will be looking for more of the same, i.e., bullish economy comments coupled with large-cut prospects to fuel the stock market. Traders will also hear from Treasury Secretary Janet Yellen on an intriguing day for markets.

Core PCE & GDP In Focus

In what should be a lively end to the week, traders will find out the current health of the US economy on Thursday when the Gross Domestic Product figures are released. The economy is expected to have grown by 3% in the previous quarter, which would be enough to give the NASDAQ a bullish tone this week.

On Friday, traders will find out the current core PCE inflation level, a high-impact release that all NASDAQ traders should pay attention to. This is the Federal Reserve’s primary inflation gauge, and it is expected to remain at 0.2% MoM.

NASDAQ To Rise Past 20,000? 

The NASDAQ has been finding support over the last few days, particularly at 19,600 and 19,700 when the market threatened to move lower before the buyers stepped back in. The “pullbacks” are more like consolidation periods, so it is just about waiting for a break from the pause. 

That break out could be happening imminently, with the market having consolidated for a few days between 19,900 and 19,700. Traders may utilize a buy-stop order at the current high and target a move beyond 20,000. There is little evidence to support a move lower at this time.