From the Trading Desk

NASDAQ 100 Lags Broader Market

The day started off well with prices higher across the board. However, NASDAQ 100 ran into selling weighing on the NASDAQ and entire market. Volume was lower during the session. It never had a chance to challenge Friday’s juiced (Russell Rebalance) level. One thing we were looking to see was a late day kick save, but there were not enough buyers around willing to rush into the market. Small caps stocks led the major exchanges in gains, but were only up 13 basis points. While not a terrible day we would have liked to see the market close on strength versus weakness. Let’s see how this last week of June and the second quarter shape up the rest of the week. As always, keep vigilant with your position sizes and your exits.

The FANG stocks look quite vulnerable. AAPL was the only FANG stock below its 50-day, but given current price action a move to the 200-day would not be out of the question. GOOGL is another FANG stock vulnerable, but most of them are now. If they have more downside they would certainly weigh heavily on the NASDAQ and NASDAQ 100. Rotation out of big cap tech into small caps, financials, biotechs, etc could very well be in the cards. We will react to what the market gives us. If it is rotation we will take it. Otherwise, our stops will protect our downside and regroup for new signals. It is not any more complicated than this. Simply follow your stocks and do not overcomplicate matters.

Not the start we wanted for the last week of trading in the month of June. There are four days left and anything is possible and we must be prepared for any situation. Regardless of where this market is going to go we will be prepared. We wish you the best of luck in your trading this week!

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