LIVE MARKETS-Nasdaq composite: Enough thrust to keep its streak?

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NASDAQ COMPOSITE: ENOUGH THRUST TO KEEP ITS STREAK?

Since its April 8 cycle low on a closing basis, the Nasdaq composite .IXIC has been on fire. The tech-laden index has rocketed 25.41% to end Wednesday at 19,146.80. With this, it ended down just 5.1% from its December 16 record close.

Meanwhile, in early May, one measure of the Nasdaq's internal strength, the Nasdaq New High/New Low index (NH/NL), hit a more than three-month high:

On April 10, the NH/NL index ended at just 7.8%, which was its lowest level since early November 2023. More recently, amid renewed strength across the broader Nasdaq, on May 5, this measure rose to 54.7%, or its highest level since 55.1% on January 31 of this year.

However, it then pulled back to 50.5% into last Friday's close, while nearing its rising 10-day moving average (DMA). The NH/NL index has since ticked up slightly. It ended at 52.6% on Wednesday.

Thus, despite the IXIC moving higher this week, the internal strength measure is still shy of its May 5 high. Bulls will want to see it resume a more forthright rise, and a thrust above the 54.7%/55.1% area can clear the way for it to challenge the resistance line from its early 2023 high, which is now at 73.3%, and seen as a major hurdle.

E-mini Nasdaq 100 futures NQcv1 are suggesting the Nasdaq 100 index .NDX is poised to drop at Thursday's open. Thus, the composite's six-day winning streak, the longest since an eight-day run of gains in August 2024, may be in jeopardy.

In the event the NH/NL index rolls over and closes below its 10-DMA, which should be around 52% on Thursday, the composite may find itself on the back foot again.

That said, the IXIC has support at its 200-DMA, and the Fibonacci-based 233-DMA, which now reside in the 18,339-18,275 area.

(Terence Gabriel)

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