The trade: US Tech 100 and bitcoin brace for pullbacks amid market volatility

(AI video summary)

This video was created on 21 May for IG audiences by ausbiz.

US Tech 100 poised for correction

The US Tech 100 (Nasdaq 100) has experienced a strong run-up from April lows in what appears to be an impulsive Elliott Wave pattern. Markaets are now seeing a Wave 4 correction that could bring the index down to around 20,500, just ahead of the 200-day moving average (MA).

Despite this potential pullback, the broader bullish theme remains intact. If we do get a pullback, it presents an opportunity to reload long positions.

Australia 200 consolidation continues

The Australia 200 (ASX 200) has shown impressive strength, with Commonwealth Bank of Australia (CBA), Wesfarmers, Coles, and Telstra performing well.

The market needs to consolidate before pushing to new highs. With the relative strength index (RSI) in overbought territory and approximately 50 days until tariff expiry, sideways movement within 200 points of the 200-day MA are anticipated.

Australian dollar at key resistance

The Australian dollar (AUD) has formed a V-shaped bottom but needs to break above the 200-day MA and the 0.6500 - 0.6520 resistance to confirm its uptrend. A decisive break could open the path toward 0.6750.

Safe-haven assets strengthen

Reports of potential Israeli strikes on Iranian nuclear facilities have triggered market responses, with crude oil prices surging and gold strengthening as a safe-haven asset.

• Crude oil: remains range-bound between $55 and $65, though it spiked higher before retracing some gains. Despite these geopolitical concerns, the overall price action continues to respect the established trading range.
• Gold: displays bullish characteristics after completing what is described as a 'very corrective' retracement from its $3500 high down to the $3120 low last Friday. A bullish recommendation is placed on gold looking for a retest of that $3500 high.

Bitcoin nears record territory

Bitcoin is approaching record highs, with MicroStrategy now owning approximately 3% of total supply. Institutional demand has kept pullbacks shallow. A break above $110,000 could signal the next leg higher.