NASDAQ contemplating its future
It was fine to have a little consolidation on Wednesday after NASDAQ finally secured a clean breakout from its former near-term peak in March. Now, the big question is where to next. We could well see a hefty amount of consolidation over the coming couple of weeks, but mixed in with lingering enthusiasm for milking the breakout for all it's worth. In other words, some volatility. It's really mostly a matter of how much pent up bullishness still exists among the short-term speculative crowd, and of course, whether mutual fund and other money managers and retail investors redirect some of the vast amount of sidelined cash into value and momentum stocks.
I forgot that this was another holiday week. Friday is a holiday and today has a shortened trading session, so I suspect that any short-term speculators wishing to close out positions ahead of the long holiday weekend probably did so on Wednesday so they could take Thursday off as well.
NASDAQ futures are up moderately, but once again the question is whether short-term speculators sell into any rally or buy on dips. And there is still plenty of room for aggressive short-term speculators to engineer impressive short squeezes at any time, forcing the market higher, but not necessarily in a sustainable manner.
-- Jack Krupansky