The Nasdaq shot to new highs this week, sweeping through levels not seen since the dotcom bubble. And while the market backed off slightly Friday, one trader insists it's the perfect time to buy.
"The Fed really fueled the rally this week by being much more accommodative than the markets were expecting," technical analyst Todd Gordon said Friday on CNBC's "Trading Nation." The Nasdaq and S&P 500 tracked for their best weekly gain in eight weeks during afternoon Friday trading. The was on track for its best week since May 8.
According to Gordon, the chart of the Nasdaq 100 ETF, which trades under the ticker symbol QQQ, is presenting a promising buying opportunity. "The chart saw a nice uptrend in April and then settled into consolidation through May and the first half of June," said Gordon, founder of TradingAnalysis.com. And now, he added, "I'm looking to play on a bit of a pullback."
And Friday's action is exactly what Gordon was looking for. "If we can get an entry toward $110, I think we could see the QQQ surge to around $114." That's more than 3 percent higher than the current level and puts the ETF at a new high.
But Gordon warned it may not be a straight line up. "First we have to get through resistance $111.25," he said. "If we were to break that level, the upside would be in play and we could see a rally similar to what we saw in April," which was about 3 percent from start to end.
"The QQQ looks strong here."
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