6 Jun 2021, 14:12
THE WEEK AHEAD 7 JUN 2021:
Last Friday’s Non-Farm Payroll was a huge disappointment. Only 555k jobs were created as compared to 645k jobs projected. Yet, the stock market rallied up on Friday. Is it bad news is good news again?
This week, we continue to look at the Nasdaq 100 Index for clues in our weekly market outlook. We are increasingly confident that this could be a technology bubble forming as tech stocks still retain their bullish leadership amongst the stocks. Therefore, we look at the Nasdaq as a leading indicator. We still see the Nasdaq stuck in a wedge, demarcated by the black resistance line and blue support line in the chart. Last week, the index was moving mostly sideways within a range between the two brown lines. Except, on Thursday, it threatened to become bearish when the candle on that day went below the brown lines (as circled). However, this was swiftly repudiated as Friday saw the index moving back within the brown lines again.
This could mean that there was a failed bearish breakdown which resulted in a bullish move on Friday. And this could signal more bullish upside for stocks and could see the index heading for the wedge’s black resistance line in the coming weeks. Most investors should be licking their lips now with a prospect of a new wave up.
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