Nasdaq call -March 2026
A Simple Strategy to Beat Passive Investing — and Why the Nasdaq Would Make New Highs by July 2026
For a long time, passive investing strategies have beaten active managers and active management strategies. This has reinforced the belief that passive investing is the best option for retail investors. But as more and more people crowd into passive strategies, the risk of the strategy itself increases — it concentrates capital by market-cap weight and, at bottom, leans on the logic of the greater fool theory. We're not going to relitigate the passive-versus-active debate here. Instead, this is a simple strategy retail investors can use to exploit passive investing's structural blind spots.
01 The Setup: Why Passive Investing Is Vulnerable
By current estimates, roughly 62% of the US stock market is now controlled by passive funds. Passive capital allocates blindly by market cap — which means the most overvalued stocks receive the largest weight precisely when they are most dangerous, and the most undervalued stocks receive the smallest weight precisely when their risk/reward is best. Passive flows cannot exploit the predictable behavior of algorithms and institutional order flow; almost by construction, they aren't built to.
That predictability is the opening. As a retail investor, we can use market structure and liquidity grabs to deploy capital into fundamentally good businesses we've already researched and have high conviction in — buying into the exact moves that passive flows are structurally unable to anticipate.
02 The Strategy: Reading Market Structure
The setup rests on two tools: moving-average touches to time entries within an established uptrend, and liquidity grabs to identify when a shakeout is over.
Moving-average touches
Once the 50-week EMA crosses above the 200-week EMA, the trend turns bullish. From that point on, touches of the moving averages are buying opportunities. The 20-week EMA gets touched most often, but a touch of the 50-week EMA offers a meaningfully better risk/reward — a deeper pullback bought at a level the trend has historically respected.
03 Spotting the Low: Consolidation, Manipulation, Distribution
Between November 2024 and March 2025, the Nasdaq consolidated in a range while market makers engineered equal highs. The price was then suddenly moved down — that particular drop followed the "Liberation Day" tariff announcement, and market makers often use news events like this to manipulate price. The index made a low, then rallied hard to take out the engineered liquidity above the consolidation, with hardly any pullback on the way. In algorithmic terms: price sweeps the sell-side liquidity first, then moves to the opposing buy-side liquidity.
To confirm a low has actually formed, look for index divergence — one of the three major US indices making a higher low while the others make equal or lower lows suggests accumulation underneath the surface. It's an edge, not a certainty; buying into weakness still carries risk, and it's rarely comfortable. A genuinely bearish tape among market participants is itself a supporting signal. At Muffett Investments, the discipline is to raise cash as soon as we see consolidation form, so there's capital ready to deploy once price is manipulated lower.
04 The Call: Nasdaq, March 13, 2026
By March 2026, the Nasdaq had spent roughly six months — September 2025 through March 2026 — consolidating with a well-defined floor of equal lows sitting just above a liquidity zone near 22,000. The setup looked identical to the November 2024 pattern: a range, a series of engineered equal highs, and a liquidity pool sitting untouched just beneath the range.
"We think that price is likely to take out the lows of the consolidation before a move above. Considering that President Trump has the stock market close to his heart and that he would rate his performance based on the stock market's performance, we think that ultimately the price would move and take out the liquidity at the top."
The call: expect a sweep of the lows first — the sell-side liquidity — followed by a move to the opposing buy-side liquidity above the range, with the Nasdaq making new all-time highs by July 2026. Whether the initial move down happened wasn't really the point; the point was that the destination was up, and that new highs would arrive within about four months.
05 Verdict: How It Played Out
We checked this call against public market data rather than taking our own word for it.
| Date | Event | Nasdaq Composite | Change |
|---|---|---|---|
| Oct 29, 2025 | Prior all-time high | 24,019.99 | — |
| Mar 13, 2026 | Call published | — | — |
| Mar 30, 2026 | Correction low | 20,794.64 | −13.4% |
| Apr 15, 2026 | Round-trip back above 24,000 | 24,016.02 | +15.5% |
| Jun 2, 2026 | New all-time high | 27,093.90 | +30.3% |
| Jul 29, 2026 | Semiconductor-led correction | 24,442.94 | −9.8% |
| Sep 3, 2026 | Most recent close | 26,584.06 | +8.8% |
Change columns are period-over-period versus the immediately preceding row.
Confirmed — and early
The Nasdaq did exactly what the call said it would, in the order it said it would. The index sold off sharply into late March 2026, undercutting the prior range in a move consistent with the liquidity-sweep pattern the post described, before staging a strong, largely uninterrupted rally. It closed at a new all-time high on June 2, 2026 — a full month before the July deadline the call had set.
The one thing the original post didn't call was the semiconductor- and memory-stock-driven correction that knocked the index back down roughly 10% by late July. That pullback arrived after the new-highs call had already been satisfied, so it doesn't undercut the thesis — but it's worth naming plainly rather than only showcasing the parts that flattered the call.
