Chart of the day

Where do we stand fundamentally?

Palantir, MicroStrategy, and Axon Enterprise are set to join the Nasdaq 100 Index, replacing Super Micro Computer, Moderna, and Illumina, indicating a shakeup in the index composition.

The NASDAQ 100 Index underwent a rebalancing which affected the weight of several major tech stocks. Companies like Tesla, Meta Platforms, and Broadcom saw their influence reduced due to their high valuations following a tech rally in 2024.

NASDAQ is testing the upside resistance 22500, which is expected to peak at the fifth long-term Elliott Wave. My KNOWPO trading system indicates a good low-risk short trade here, so I expect a reversal downside as we have possibly reached the fifth upside long-term Elliott wave. The medium-term target should be 20000.

A break above 22500 will invalidate the downside reversal and lead to a higher extension. A break below 21000 will accelerate the downside reversal.

_{You can take a short trade entry with a stop loss above 22900 to target 20000.}