S&P 500 & Nasdaq Analysis and Trends

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NASDAQ Composite Index (COMP) »» Weekly Summary Analysis
By: Marty Armstrong | December 24, 2022

The NASDAQ Composite Index Cash closing today at 1049786 is immediately trading down about 32% for the year from last year's settlement of 1564497. Currently, this market has been rising for this month going into December reflecting that this has been only still a bullish reactionary trend. As we stand right now, this market has made a new high exceeding the previous month's high reaching thus far 1157164 while it has not broken last month's low so far of 1026293. Nevertheless, this market is currently trading below last month's close of 1146800.

Up to now, we still have only a 1 month reaction rally from the low established during October. We must exceed the 3 month mark in order to imply a trend is developing.

ECONOMIC CONFIDENCE MODEL CORRELATION

Here in NASDAQ Composite Index Cash, we do find that this particular market has correlated with our Economic Confidence Model in the past. The Last turning point on the ECM cycle low to line up with this market was 2009 and 2002. The Last turning point on the ECM cycle high to line up with this market was 2007 and 2000.

MARKET OVERVIEW
NEAR-TERM OUTLOOK

The historical perspective in the NASDAQ Composite Index Cash included a rally from 2009 moving into a major high for 2021, the market has pulled back for the current year. The last Yearly Reversal to be elected was a Bullish at the close of 2019 which signaled the rally would continue into 2021. However, the market has been unable to exceed that level intraday since then. This overall rally has been 12 years in the making suggesting it could still press higher for another year.

This market remains in a positive position on the weekly to yearly levels of our indicating models.

Looking at the indicating ranges on the Daily level in the NASDAQ Composite Index Cash, this market remains moderately bearish position at this time with the overhead resistance beginning at 1071397 and support forming below at 1049755. The market is trading closer to the support level at this time. An opening above this level in the next session will imply a decline is unfolding.

On the weekly level, the last important high was established the week of December 12th at 1157164, which was up 6 weeks from the low made back during the week of October 31st. We have been generally trading down for the past week, which has been a very dramatic move of 10.87% in a stark panic type decline.

Immediately, this decline from the last high established the week of December 12th has been important closing sharply lower as well. Before, this recent rally exceeded the previous high of 1121038 made back during the week of October 24th. Nonetheless, that high was actually lower than the previous high made the week of August 15th suggesting this market has really been running out of sustainable buying for right now. This immediate decline has thus far held the previous low formed at 1026293 made the week of October 31st. Only a break of that low would signal a technical reversal of fortune and of course we must watch the Bearish Reversals. Right now, the market is below momentum on our weekly models casting a bearish cloud over the price action. Looking at this from a wider perspective, this market has been trading up for the past 1 week overall.

INTERMEDIATE-TERM OUTLOOK

YEARLY MOMENTUM MODEL INDICATOR

Our Momentum Models are rising at this time with the previous low made 2018 while the last high formed on 2021. However, this market has rallied in price with the last cyclical high formed on 2021 warning that this market remains strong at this time on a correlation perspective as it has moved higher with the Momentum Model.

Looking at the longer-term monthly level, we did see a correction from the key high of August for two months. Since that low made in October, the market has rallied for 1 month. Meanwhile, the past month has witnessed a rally of 13% percent. A month-end closing below 1026293 will warn that the market is losing its upward momentum and should retest support below. It will take generally a monthly closing above 1149262 to maintain a near-term upward rally.

Some caution is necessary since the last high 1318109 was important given we did obtain three sell signals from that event established during August. That high was still lower than the previous high established at 1621223 back during November 2021. Of course, that was the major high in this market, which means we have a downtrend for the past 12 months. Even so, we have elected three intermediate Monthly sell signals to date from the turning point of November 2021 on this monthly time level from that major high so there is still important underlying support which needs to be broken to change the trend on this time horizon. Critical support still underlies this market at 853770 and a break of that level on a monthly closing basis would warn of a further decline ahead becomes possible. Nevertheless, at this time, the market is still weak.

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