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SML - Stock Market Directory

Nasdaq 100 Trading

By: MarketVolume.com Team

Article Category: SML Index Trading

The NASDAQ 100 Index includes 100 of the largest domestic and international non-financial companies listed on The NASDAQ Stock Market based on market capitalization. The Index reflects companies across major industry groups including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. It does not contain financial companies including investment companies.

When interpreting the chart above, you need to remember that the most important factor is the relationship between Index Price and the Volume Moving Average (VMA). Since the index was trending down when the VMA surge occurred it is a signal that professional investors are covering shorts and buying, that means that the index will soon change direction and go up. It is during or just after this peak in the VMA that we would make a trading decision. As the index begins to fall we see that the volume moving average is beginning to increase quickly. It is at the peak of his new VMA surge that we should look at making another trading decision as this VMA surge signals an end to the downward trend.

With the NASDAQ 100 Indicator you can accurately foretell changes in the direction of the NASDAQ 100 Index or the NASDAQ Composite Index, as the NASDAQ Composite and the NASDAQ 100 Indexes retain the same essential momentum patterns. By knowing the future directional changes of the NASDAQ in advance, one could trade securities which tracks the performance of the NASDAQ 100.

Below is an example of how one of our exclusive institutional investors used this signal for the index to maximize profits by trading some of the derivatives of the NASDAQ 100 index:

Details of the above trades, and the derivatives used for this index, can be found in the detailed overview and in the member's section of our site.