2024-06-17 - a weekly price action market recap and outlook - nqGood Evening and I hope you are well.
Nasdaq. 20000. What else can you say. The AI bubble will be in the history books and Michael Lewis will write a book about the insanity that’s going on. I sincerely hope they bring the exact cast back from the big short. You can quote me on this one. Over the next months, you will read about companies cutting back on spending, especially on AI since it’s expensive af and not bringing in any money. Nvidia will probably be halved somewhere in 2025/2026 so stock should hit around 65ish. Monthly ema is at 60. I looked that up after I wrote the halving part.
comment: Let’s review this weekly painting, now that we finally reached 20000. All bullish targets are met, the upper bull channel is broken and I expect this to be a bull trap rather than a breakout above with follow through. If nq trades above 20100, I am obviously wrong. Last two times we reached new highs we sold off for a couple of weeks and this is what I expect this time as well. Market will most likely pull back from here and then retest the ath again before we trade back to the smaller bull channel around 18500 or lower.
current market cycle: 20000. Get a tattoo of that.
key levels: 18000 - 20000
bull case: Bulls outdid themselves on this one. One for the history books. Can they get higher? Sure but I doubt it. Have nothing for them in this section. Move on.
Invalidation is below 19000.
bear case: Let’s see if they appear tomorrow. We should see a decent pullback to at least 19500 over the next days, follow by a retest of the ath, which should fail. A bigger two-legged correction should get us down to 18500 over the next days/weeks. On the bigger time frame all my bullish targets are met and all wave series ended between 19000 and 20000. Got nothing for the bulls here.
Invalidation is above 20100.
short term: Who buy’s this above 20000? Let’s see tomorrow. If they actually do, no idea where it can go. I expect a pullback to 19500 and the daily 20ema.
medium-long term: This climactic blow off top was the grand finale of this bull trend. Perfect break above multiple patterns which I expect is a bull trap and we will test the various support lines next before the new bear trend will unfold over the next 3-9 months.
current swing trade: Short 20000 until bulls manage to break 20100 or big profits. I will take profits and add to this position along the way.
Chart update: This is my best guess on how the next 3-9 months will play out. Gave all the reasons above.
