Market Trends

Profit/Loss Potential of Stocks
06/09/24

We calculated what are the possible movements and respective profit for various shares. The analysis is simple and based solely on the last 52 weeks movement. You can see what is the potential profit and calculate the potential loss. We take as a relative investment per Symbol 2000$. You can adjust based on your possibilities.

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NSDQ Trends, What happened after the June?

Based on the analysis on 22nd of June, we see how NASDAQ dropped shortly afterwards to 17 208. Here is a potential Profit/Loss calculation. The difference between 19750 and 17250 is 2500 points per unit. WIth 100 units the profit would be: 2500 times 100 equals to 250 000$, One fantastic profit! We appreciate all good words of traders who have used the analysis. Enjoy!

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NSDQ Trends, 21nd of June 2024

* Past movements are not guarantee for future performance

Previous Analysis Recap

In our earlier analysis, we highlighted several key technical indicators suggesting a potential pullback in the Nasdaq. The price had reached the upper boundary of the trend line resistance with an overbought RSI, indicating exhaustion in buying momentum. Our recommendation was to watch for confirmation signals of a reversal for potential sell positions.

Current Market Situation

As predicted, the Nasdaq has started to decline from its recent highs. Here is an updated analysis based on the new chart provided:

Technical Analysis

  1. Fibonacci Retracement Levels:

    • The chart shows key Fibonacci retracement levels drawn from the recent low of approximately 14,207 to the high of 19,798.
    • The price has started to retrace from its peak, with potential support levels at the 0.236 (18,655), 0.382 (17,805), 0.5 (17,118), and 0.618 (16,431) retracement levels.

  2. Elliott Wave Theory:

    • The annotations suggest a possible Elliott Wave correction pattern forming. The potential waves (1)-(5) indicate a corrective ABC pattern, which is common after a significant rally.
    • This implies that the market might see further downside movement before stabilizing or resuming the uptrend.

  3. Relative Strength Index (RSI):

    • The RSI is currently at 70.75, still indicating overbought conditions. This continues to support the view that the market is experiencing a correction.

Potential Future Movement

Based on the current technical setup, here are potential scenarios for future market movement:

  1. Bearish Scenario:

    • If the correction follows the Fibonacci retracement levels, we could see the price testing the 0.236 level around 18,655 first. A break below this could lead to further declines towards the 0.382 level at 17,805 or the 0.5 level at 17,118.
    • The Elliott Wave theory suggests a more extended correction phase, with potential for deeper retracement down to the 0.618 level at 16,431 if the bearish momentum persists.

  2. Bullish Scenario:

    • If the price finds support at the initial Fibonacci retracement levels and RSI moves out of overbought territory, the market could resume its uptrend.
    • A strong bounce from any of these levels, especially with increasing volume, would indicate renewed buying interest and potential for the market to retest recent highs.

Balanced Perspective

While the current market movement aligns with our previous bearish outlook, it is crucial to remain balanced and consider both potential outcomes:

  • Monitoring Key Levels: Keep an eye on the Fibonacci retracement levels for signs of support or further breakdown.
  • Volume Analysis: Watch for volume spikes at support levels to gauge the strength of potential reversals.
  • Fundamental Factors: Stay updated on economic data and central bank announcements, which could influence market sentiment and direction.

Conclusion

Probabilities Based on Technical Analysis

  • Bearish Probability: 65%
    • Reasons: Trendline break, overbought RSI, Fibonacci retracement suggesting correction, high volume on down moves, and Elliott Wave pattern indicating further downside.
  • Bullish Probability: 35%
    • Reasons: The overall long-term trend is still up. A bounce from key Fibonacci levels and a reversal in momentum indicators could shift the trend back to bullish.

Given the technical indicators and current market behavior, the bearish scenario seems more likely in the short term. However, staying vigilant and ready to adjust the strategy based on new data and market movements is essential.

Disclaimer: The information provided in this analysis is for informational purposes only and should not be considered financial or investment advice. Always conduct your own research and consult with a qualified financial advisor before making any investment decisions. The author and the website do not assume any liability for any losses incurred based on the information provided in this analysis.

NSDQ Trends, 18th of June 2024

* Past movements are not guarantee for future performance

To analyze the current market movement of the Nasdaq as shown in your chart, we can consider several key technical analysis aspects. Here is a balanced analysis with a slight inclination towards a bearish or sell perspective:

Technical Analysis

  1. Trend Line:

    • The chart shows a clear upward trend with the price respecting the trend line over an extended period. The market has recently hit the upper boundary of this trend line, which often acts as a resistance level. This could suggest a potential pullback or consolidation phase.

  2. Resistance Levels:

    • The current price of 20,215.54 is close to a psychological resistance level of 20,000. Such levels are often tested multiple times before a decisive breakout or reversal occurs. Given the sharp rise in recent times, the market might be due for a correction.

  3. Relative Strength Index (RSI):

    • The RSI indicator at the bottom of the chart is showing a value around 85, indicating overbought conditions. An RSI above 70 generally suggests that the market is overbought and might experience a pullback.

  4. Volume:

    • Although the volume is not shown in the provided chart, typically, a volume analysis would complement this. If the recent upward movement is accompanied by declining volume, it would suggest a weakening trend and potential reversal.

Balanced Perspective

  • Bullish Factors:

    • The long-term trend is upward, and as long as the trend line is respected, the market is technically in an uptrend.
    • A breakout above the trend line with strong volume could signal further bullish momentum.

  • Bearish Factors:

    • Overbought RSI indicates potential exhaustion in buying momentum.
    • The proximity to the upper trend line and psychological resistance suggests a higher probability of a pullback or correction.
    •  

Summary

Given the technical indicators, a balanced but slightly bearish outlook can be summarized as follows:

  1. Sell Position:

    • Consider entering a sell position if the market shows signs of reversing from the trend line resistance and overbought RSI levels.
    • Use a stop-loss above the recent high to protect against a false breakout.

  2. Wait for Confirmation:

    • Wait for a confirmation signal such as a bearish candlestick pattern (e.g., a shooting star or bearish engulfing) near the resistance trend line before entering the sell trade.

  3. Targets and Risk Management:

    • Set initial targets near previous support levels around 18,000 and 17,000.
    • Adjust stop-loss levels to protect profits if the trade moves in the favorable direction.

This analysis suggests that while the long-term trend remains upward, the current market conditions favor a cautious approach with a potential short-term sell opportunity. Always consider complementing this technical analysis with fundamental analysis and other market factors before making trading decisions.

Disclaimer: The information provided in this analysis is for informational purposes only and should not be considered financial or investment advice. The analysis reflects market conditions and technical indicators as of the date shown and is subject to change without notice. Past performance is not indicative of future results. Always conduct your own research and consult with a qualified financial advisor before making any investment decisions. The author and the website do not assume any liability for any losses incurred based on the information provided in this analysis.