FxWirePro: Sell NASDAQ 100 for 1:3 risk-reward ratio

As the tensions between the United States and the Democratic People’s Republic of Korea (DPRK) eased the stock markets recovered some of their lost grounds, after the rapid sell-offs that were triggered by this geopolitical tension. After weeks of exchanging military threats between the United States and DPRK, the situation eased when it was reported that DPRK leader has delayed action on its strike Guam plan and South Korean President Moon Jae-in weighed in by saying that there will be no military action against DPRK without South Korea’s approval.

The US tech index NASDAQ 100 dropped sharply on 10th to reach as low as 5760 but has recovered since the easing of the tensions. It is currently trading at 5922, very close to its all-time high around 5992, made in late July this year. The geopolitical tensions had triggered a long-awaited correction, however, we feel that the current sell-off fell short of what can be described as a correction healthy for the Bull Run to continue. We expect further selling in the index. In addition to that, the earnings season is over, which was a major boost

We recommend selling NASDAQ100 at the current price of 5926 with a target around 5630 and stop loss around 6022.