The Nasdaq-100 has been rising steadily since the start of 2021, but it appears that a pullback is imminent.
The index recently topped out at its highest point ever, 12,471, but the upward trajectory could not be sustained. The index has since pulled back slightly, and many analysts are stating that this is a sign of a more significant, temporary pullback.
This pullback is likely driven by several factors, including potential investor profit-taking, increasing inflationary pressure, and higher yields on equities. These factors are likely driving investors to re-evaluate their portfolios and likely sell off some of their positions to take advantage of current market conditions.
This pullback could also be attributed to the higher valuations of some of the largest companies in the index. These high valuations are causing many investors to be concerned that the index’s current level of pricing might not be sustainable and could be facing significant downside pressure.
As a result, many investors are expecting a brief pullback in the index over the coming days and weeks. Of course, this could also mean that the index could end up slightly below where it began the year, but this scenario is less likely.
Overall, it appears that we are at the beginning of a pullback in the Nasdaq-100. This could be just a short-term correction, or it could be something bigger. Regardless, investors should keep an eye on the index in the coming days and be prepared to act accordingly. If you’re an investor looking to capitalize on this pullback, now might be a good time to consider rebalancing your portfolio or potentially lightening up your positions.