It’s been over three weeks since we last shared our Elliott Wave Principle (EWP)-based analyses for the Nasdaq 100(NDX). Back then, the index was trading at around $21482. Fast-forward through two debacles (DeepSeek and Tariffs), and with all major tech companies’ earnings behind us, the index is trading at essentially the same level: $21672.
So, the question is whether we can still expect new all-time highs (ATHs). Based on our preferred EW count, we believe the index can still reach new ATHs. Let's explain using Figure 1 below, starting with where we ended last time.
“Thus, contingent on holding at least above $20800, …, and especially above the January 13 low at $20538, we should expect the index to reach the red W-v’s ideal target zone at $22825-23400. … Meanwhile, we have penciled in a standard Fibonacci-based impulse pattern with the green W-1? through W-5? for this red W-v. However, since we’re most likely dealing with an Ending Diagonal from the August 2024 low, which comprises a 3-3-3-3-3 pattern, we may see short-term deviations, i.e., an a-b-c advance from the January 13 low.”
So far, the index has held above these two warning levels, and with the additional price data since then, we can provide more details about our preferred EWP count. In this case, the January 24 high was green W-1/a, and last week’s low was most likely green W-2/b. Thus, the index is most likely in the starting gates of the green W-3/c: grey W-i, ii. We don’t know yet if the latter has been completed at last Friday’s low, as it can still tag on another wave lower better into the grey W-ii ideal target zone ($21200-21400). But a break above last Friday’s high will seal the deal for the Bulls.
Speaking of the Bulls, the index is still above its first warning level (blue level $21618) and above its rising 10-day simple moving average (10d SMA), which is above its rising 20d SMA > rising 50d SMA > rising Ichimoku Cloud > rising 200d SMA. Thus, the price chart is currently in a 100% Bullish uptrend. As such, we prefer to have a Bullish perspective until proven otherwise.
What would that be? A break below the 3rd (orange) warning level -last Monday’s low- at $21008 for starters, but ultimately, the January 13 low at $20538 remains the Bull-Bear line in the sand. If the market decides to move below these levels, our preferred EWP count switches to our alternative (not shown), which has the more significant red W-iv become protracted and target $19930-20300 before the red W-v starts. But as stated, that’s our alternative, our insurance, in case we are wrong.
Thus, our Elliott Wave analysis provides specific levels to watch. How the market reacts to those combined with the structure of that reaction will tell us how to adjust if needed, aka “all we can do is anticipate, monitor, and adjust if necessary.” Currently, our preferred EWP count remains on track. We’re simply monitoring its progress to see if it aligns with the market’s price action. If yes, stay long and keep monitoring. If not, adjust and take appropriate trading action. Regardless, it seems new ATHs are not in jeopardy, and even a possible detour to lower prices first does not derail that plan.