The stock markets have experienced a number of volatile sessions, presenting a testing time for investors. In particular, the QQQ (Nasdaq 100 Index Tracking ETF) has been a key market mover in recent weeks. The ETF has seen a significant increase in its price from lows in late April and has risen over 8% this month as of Friday’s close. The steady advance of the ETF has been propelled by the stronger technology stocks, notably Amazon, Netflix, and Apple.
This week has seen a key inflection point for the QQQ, and investors are closely watching its performance as it nears an important threshold. On Wednesday, the QQQ briefly exceeded its all-time high of $239.59, and it has since been trading above that level for the first time since March 24. This marks a major milestone for the ETF and could be an indication of more gains ahead.
Backing up the QQQ’s bullish trend is the conditions in the bond markets. Bond yields have climbed to their highest levels in 2021, testing the top of a key trading range. The rise in yields supports a stronger outlook for the stock market. It reflects investor optimism that a robust economic recovery is on the way and that there is more upside potential in the markets after a strong first quarter.
Should the QQQ continue to rise from its current level and defer to a higher level, it could signal a positive shift in market sentiment and could provide additional confirmation of a robust stock market recovery. Of course, it could also present a risk to the stock market if the gains end up being short-lived.
The next few weeks are likely to be filled with plenty of volatile market action, with traders and investors carefully monitoring the QQQ’s performance as it nears its all-time high. Whether the ETF can push past its current level or remains stalled at its current level could provide important clues as to how the stock market winds up performing in the weeks and months ahead.