Bearish short-term speculators have tested NASDAQ at the 4600 level on four successive days and that key psychological level has held for NASDAQ every single time, which is a reasonably positive sign. That gives traders good reason to bet that NASDAQ is ready for a cleaner breakout above the 4600 vicinity and a solid start for a new leg up. That's not to say that diehard bears won't take a much more forceful run at 4600, especially if insufficient buying enthusiasm fails to materialize among bullish speculators - who may actually be just as willing to settle for a wide trading range as see a weak new leg - but at least the potential is clear.
This week will be a clean slate for the market, with so many critical anxieties behind us. That's not to say that success is a slam dunk, but just that a default bias is clear, at least until speculators, fresh back from a weekend to carefully consider their options, get back to work today and tomorrow.
Overall, I would say that it's still a 50/50 coin flip whether NASDAQ stays in a narrower trading range here, or stages a cleaner breakout and a tentative new leg up.
NASDAQ futures are up moderately, suggesting a moderate pop at the open. Whether bullish short-term speculators follow through with some fresh shifting to a "risk on" bias to counter lingering bearish enthusiasm among cynical bearish speculators remains to be seen. Futures tell us how the market will open, not how it will trend through the day.
-- Jack Krupansky