Nasdaq Index: Technicals and the 2020 US Presidential Elections

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Analysis
- To begin with, we can look at the Nasdaq Index's monthly chart on the logarithmic scale
- The logarithmic scale provides a broader overview of the general trend, as well as clearer percentage changes in the market
- We can first see that Nasdaq (IXIC) dropped significantly during the 2008 financial crisis.
- After dropping a whopping 55% (which is a lot considering that this is an index), it has been on a steady uptrend ever since
- The Nasdaq Index has been on a clear and steady uptrend since 2009, trading within an ascending parallel channel
- Ever since it reclaimed moving average support as well, prices never dropped below the 30 simple moving average (SMA).
- The Ichimoku cloud also demonstrates that the trend is clearly bullish for the long term, as prices trade above cloud support
- There have been times in 2010 and 2011 when prices tested the upper channel resistance, only to drop back and test the channel's middle line support
- During the recent market crash caused by the Corona Virus (Covid-19) outbreak, while prices have initially dropped below the channel support, the candle managed to close above it
- Nasdaq was able to not only reclaim the lower trend line support, but also the 30 sma support
- Last month, however, prices have overextended and tested the ascending trend line resistance once again.
- Based on current technicals and the fact that the 2020 US Presidential Elections is not far ahead, even a significant 26% drop would maintain the bullish trend.
- The Moving Average Convergence Divergence (MACD) shows weakening bullish histograms, but the trend's overall momentum remains solid.

Conclusion
As historical data demonstrates that the stock market has a tendency to correct before the US presidential election takes place, it's also logical to expect a form of correction, specifically in the more volatile Nasdaq Index. However, we are seeing potential signs of a functioning vaccine being developed for the Corona Virus, and with my personal expectation that the virus will no longer post any obstacles to mankind by the end of next year, that gets rid of a major issue preventing the market from further rallying. Interest rates will continue to remain low for a while, and with bullish technicals being intact, it's suggested that people look to 'buy the dip' during times of a correction.