Nasdaq Today: When Will We Get New Highs?

The Nasdaq can still reach new highs, but it needs FAANG to participate

When the Federal Reserve made its statement on Wednesday, it appeared that its members were willing to be accommodative. The market’s response was somewhat muted to its statement that day, but that wasn’t the case on Thursday with equities surging at the open. That said, it wasn’t the most impressive showing from the Nasdaq today.

nasdaq today
Source: Shutterstock

The index ended Thursday higher by 0.80% thanks to a late-session ramp, but off its intraday gains of 1.3%. It also lagged the S&P 500 and Dow Jones, which logged gains of 0.96% and 1.01%, respectively.

Where does that leave us now?

Nasdaq and New Highs

chart of the Nasdaq today
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The S&P 500 opened at and hit new highs, but the Nasdaq is still floating below its highs made in April and May. The index continues to struggle with the 8,100 level, leaving tech investors to wonder when it will be their turn to celebrate new highs.

For readers of this new Nasdaq Today column, you may remember our question from Wednesday. Specifically, we asked when FANG would start to participate in the rally.

It’s hard to get the Nasdaq to new highs when the biggest names in tech won’t pull their own wait. Sure, Microsoft (NASDAQ:MSFT) notched another new high, but Facebook (NASDAQ:FB), Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX) and Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) aren’t doing much to help. You might as well throw Apple (NASDAQ:AAPL) in there too.

Amazon is the best performer of the bunch when it comes to how far off its highs the stock is. AMZN shares are down “just” 6.2% from its highs. However, the rest of the group — FB, NFLX, GOOGL and AAPL — are between 13% and 14.5% off their 52-week highs.

It’s not impossible, but it will be quite hard to get the Nasdaq or the PowerShares QQQ ETF (NASDAQ:QQQ) to new highs while a majority of FAANG is more than 13% below its highs.

Winners

Adobe (NASDAQ:ADBE) ripped to another new all-time high. Luckily for InvestorPlace readers, this one was mapped out as a top stock trade the other day. With its clearing of $285, it paved the way for a rally to $300. Shares closed above there on Thursday and did so on strong volume, about double its average. This one has been a beast and has pulled AutoDesk (NASDAQ:ADSK) up with it.

Speaking of pulling some weight, look at Oracle (NYSE:ORCL). Shares galloped higher by more than 8% to new highs as earnings were enough to impress investors. However, Oracle gave a big lift to some of its “dinosaur” peers too. Cisco Systems (NASDAQ:CSCO), VMWare (NYSE:VMW), Microsoft and Qualcomm (NASDAQ:QCOM) were all on the move Thursday.

While Roku (NASDAQ:ROKU) and The Trade Desk (NASDAQ:TTD) ended lower on the day and Shopify (NASDAQ:SHOP) finished well off its highs, all three of these high-octane stocks hit new all-time highs on the day. Momentum traders love this group, and it’s not hard to see why. Roku, TTD and Shopify are up 241%, 116% and 138% so far in 2019.

Losers

Tesla (NASDAQ:TSLA) was an underperformer on Thursday. Shares shed about 3% on roughly average volume, as analysts at Goldman Sachs cut their price target. The timing was impeccable, as the decline lined up perfectly with resistance on the charts.

While not typically considered much of a play in the Nasdaq today, American Airlines (NASDAQ:AAL) took a tumble. So too did United Continental (NASDAQ:UAL), with both stock falling 3.2% and 1.7%. The surge in oil prices isn’t helping investor sentiment, as AAL opened higher on the day, but couldn’t push through resistance. Let’s see if the airlines can shake the turbulence or if it’s in for a rough ride for the rest of this month.

Bottom Line on Nasdaq Today

If you only look at the closing prices, Thursday was a good day for the Nasdaq. Although it bounced nicely off the intraday lows and finished strong, it did end well off its highs. It’s a win for the bulls, but all is not lost for the bears.

Going into the weekend, it will be interesting to see if longs can garner any more momentum. They’ll need FANG + Apple to help out in order to get the Nasdaq to new highs at some point. It also sets up an interesting dynamic with the Fed meeting next month and investors’ current expectations for a rate hike, along with earnings set to start in the second half of July.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL, AMZN, GOOGL, ROKU and TTD. 


Article printed from InvestorPlace Media, https://investorplace.com/2019/06/nasdaq-today-when-will-we-get-new-highs/.

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