The Nasdaq 100 has reclaimed its place as the leader among US indices after the reflation trade was put on pause amid declining Treasury yields. As a result, the tech-heavy Nasdaq 100 has pushed to new heights in consecutive sessions with relative ease as the broader risk appetite remains accommodative. That said, weeks of gains have left the index rather extended as it moves toward a potential zone of overhead resistance drawn off the September high.

NASDAQ 100 PRICE CHART: 4 - HOUR TIME FRAME (SEPTEMBER 2020 – JULY 2021)

While the level is merely a trendline projection at this stage, there are few barriers to the topside making it a notable spot to watch should the Nasdaq 100 continue northward. If the Nasdaq does look to drive higher, given risk aversion remains at bay, bulls might look to utilize prior resistance as support going forward in the event of brief consolidation.

The most notable nearby support is likely derived from the rising trendline drawn off the May 19 swing low. The level coincides with various intraday lows since its inception which suggests it has helped guide the Nasdaq 100 higher. Thus, a breach of the level could see losses accelerate toward secondary support derived from the index’s February 2021 high.

With that in mind, it would seem there are few scheduled event risks worthy of sparking such a move. To be sure, earnings season kicks off next week with the largest domestic banks leading the charge, but earnings from the most notable technology stocks remain weeks away.

Without a concrete shift in sentiment or the fundamental landscape, it seems the path of least resistance remains to the topside at this time, although the risk-reward profile of long exposure is less than ideal in my opinion.