NASDAQ 100 Rally to New All-Time Highs Remains On Track

Why the Elliott Wave Is an Essential Tool

For those new to our work and analyses, using the Elliott Wave (EW) Principle and our BIMBO concept, “any Bear market/correction is a Major Buying Opportunity,” we have been Bullish on the stock market and the NASDAQ100 (NDX) since early April, when we concluded,

“we focus on the index wrapping up these smaller 4th and 5th waves, which will be followed by a rally of at least 15-25%.”

Fast forward, and the index has increased by over 25% since then. Moreover, in our last update about the NDX, we showed that the index would preferably top out for an (orange) W-3 at around $21400, then drop to $20800+/-100 for a (orange) W-4, and rally to $22000+/-200 for a W-5 of a grey W-iii/c. See Figure 1 below. It reached $21483 last week, dipped to $20778, and is currently trading at $21378, all right on target. Thus, objectively analyzing the stock market’s price charts using the EW has kept our premium members on the right track; it is an essential tool for accurately assessing the stock market.

Wrapping Up the Next Set of Fourth and Fifth Waves

The index should now be in the orange W-5, and although we still cannot know at this stage if we will get five waves up (1-5) or only three (a-b-c) on the two remaining degrees (grey, green), we prefer the five-wave sequence due to several external factors like recent breadth thrusts we have discussed. However, we must continue to label the current advance as 1/a, 2/b, 3/c, 4?, 5? until one or the other has been proven.

Therefore, we can proceed with our preferred bullish Elliott Wave count. We still expect the orange wave five to conclude at $22000+/-200, followed by a grey W-iv four declining to $21000+/200, and a grey wave five ideally reaching $22400-900, contingent on the index’s price remaining above at least $20778 (grey warning level) and especially $20613 (orange warning level).