Let’s check in on the progress of the NASDAQ Composite from its breakout from the Cup With Handle chart pattern. This review will stay focused shorter-term since I have discussed log-term upside price targets in the previous articles for the index.

NASDAQ Composite

This first chart for the NASDAQ Composite is a 3 year weekly candlestick chart. I’ve overlaid 2 shorter-term Fibonacci Extension Tools on the chart while also leaving longer-term ones on there.

The NASDAQ’s price is approaching the 261.8% Target Line for the black Fibonacci Extension Tool. Fibonacci Extension Tools are one of my main tools to calculate price objectives.

It will be important to monitor the[s2If !current_user_can(access_s2member_level1)]……

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I review the items to watch for from a technical analysis perspective to determine if the NASDAQ Composite will break through its overhead resistance area.

If you are not a Trendy Stock Charts member, consider joining today! There are several different subscription plans available.[/s2If][s2If current_user_can(access_s2member_level1)] MACD Histogram as the NASDAQ approaches and is in the 6800 – 6900 price range. If it is starting to gain buying momentum as it reaches the resistance area the chances for a continued breakout increase.

There are 2 other 261.8% Target Lines for the index in the 6800 price range. Due to the confluence of Target Lines in the 6800 area, I anticipate the uptrend may take another break around this level. That still leaves approximately 7% upside for the index in the next couple of weeks, possibly through the end of the year.

But since there are a total of 3 different 261.8% Target Lines within 5% of each other, I would be surprised if the market did not consolidate some of its moves for a short time after reaching the 6800 – 7000 price range.

As an initial estimate, the amount of time it may take to reach the 7,000 price area could be about the end of the year.

NASDAQ Composite (COMP)

This next chart is a 2 year daily candlestick chart for NASDAQ Composite (COMP). Each of the purple channels is a Rising Window candlestick pattern whose window has not yet closed. Rising Window candlestick patterns are the equivalent of ‘gap-ups” in westernized investment terminology.

IMO, it is extremely important to monitor open gap-ups during a strong uptrend. These open gap-ups are the first line of defense during a market correction or general market weakness. Areas where gap-ups intersect with supporting trendlines provide a greater likelihood of a rebound from the area during a normal pullback.

During a market pullback or market weakness, if a gap does get closed, it is important to see “how” a gap gets closed. Was it on light selling volume? Or was it on heavier than normal selling volume? Asking those questions may provide an answer if the support area will hold or look to pullback to the next one below.

NASDAQ Composite – Summary

Continue to stay long your favorite stocks. Consider selling some of your “trading shares” in each position if the market starts to see some resistance as expected in the 6,800 price area. While higher price targets still lie ahead, this could be an area of a consolidation that takes longer than any other so far during the uptrend. A sideways consolidation would be expected if the index does consolidate at this level.

With possible resistance areas coming a few weeks down the road, be certain to ask for updates on stocks in your portfolio to see where some of their upside price targets and resistance areas may be. It never hurts to review your portfolio holdings and short, medium or long-term price objectives.

On deck: FANG stocks

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