TRADE SETUP

Where do we stand fundamentally?

A significant driver of recent Nasdaq gains was the U.S.-China 90-day tariff truce announced on May 12, 2025, which led to a 4.3% surge in the Nasdaq Composite. This rollback of tariffs benefited tech stocks, including those in the semiconductor sector like AMAT, as it alleviated concerns about supply chain disruptions and costs.

On May 16, 2025, Reuters reported that Thoma Bravo divested the exchange operator's entire stake in Nasdaq. While this pertains to the Nasdaq exchange rather than the Composite index, it reflects shifting investor strategies in the financial infrastructure supporting stocks like AMAT.

NASDAQ is reaching the top of the rising wedge at 21500 with smaller range daily candles, which can be a sign of a possible pullback, as the rally lasted 6 days.

We need a sustained breakout above 21500 for the rally higher to continue. I am inclined to a short trade entry in the short term, as usually rising wedges lead to a decline. If we get a break above the 21500, the bull market will continue to a new all-time high.

_{I am taking a near-term short-trade entry with a SL above 21800 to target 18800. You can buy put options as well.}