The Nasdaq index is close to overbought and got rejected from a long-term trend line test. This may be just a small pullback before it decisively breaks the trend line, or it may just be the beginning of a cycle downward. I've drawn a parallel channel and plan to buy near the bottom of the channel and set a stop loss just below channel bottom. If it breaches channel bottom, we may cycle down to either the next trend line or to support at 7980.
Comment:
The Nasdaq broke above the trendline resistance on this morning's China trade news. Investors are looking a little hesitant to enter at such a high RSI, but my expectation is that we hold above the trend line and continue to move into overbought RSI for the rest of this week.
Comment:
With maybe a selloff Friday.