What Happened
Wall Street research house Bernstein has identified AI data centre connectivity — particularly optical networking components — as the next high-growth battleground for investors. Lumentum Holdings surged over 18% in the past month to around $98.50, drawing attention to a broader basket of lesser-known connectivity plays. The Nasdaq Composite, the key index housing most of these names, closed at approximately 19,340, up 0.6% on the session.
Key Levels
Nasdaq Composite:
- Support 1: 18,900 — recent consolidation base
- Support 2: 18,400 — 50-day moving average zone
- Resistance 1: 19,500 — psychological round number and recent swing high
- Resistance 2: 20,000 — major long-term resistance and all-time high region
Nvidia (NVDA) — closely watched as a proxy for AI capex sentiment — is trading near $131.00, with support at $122.00 and resistance at $140.00.
Technical Picture
The Nasdaq remains in a short-term uptrend, trading above its 20-day moving average (~18,950) and 50-day moving average (~18,420). RSI sits near 62 — bullish but not yet overbought. The trend favours buyers while price holds above 18,900.
On the ASX, technology proxy stocks like WiseTech Global and Macquarie Group (MQG) — which has data infrastructure exposure — are worth monitoring. MQG last traded near $224.50, with support at $218.00 and resistance at $230.00.
What Traders Are Watching
- A Nasdaq break above 19,500 could trigger momentum buying into AI connectivity names
- Nvidia holding $122.00 support is critical — a break lower would signal broader AI sentiment risk-off
- MQG above $230.00 opens a run toward $238.00 for ASX traders seeking local exposure
Bias
Bullish — The structural AI capex story remains intact, and connectivity infrastructure is an early-cycle beneficiary. As long as the Nasdaq holds above 18,900, the path of least resistance is higher for this theme.
Source: MarketWatch / Bernstein Research