Nasdaq (QQQ) is technically strong with positive momentum and recent highs, but faces risk of a near-term peak due to a mature daily cycle.

We will discuss why this is important for stocks, and then we will follow this relationship in high-yield bonds and the Russell index, where we have seen much greater technical damage than we have seen in the S&P and Nasdaq indices.

The Nasdaq index is even stronger. We'll take a look at it next. Here is the weekly chart for the Nasdaq index. The weekly structure remains constructive with the price staying above all significant weekly averages and moving towards a new record high this week.

This extension area here contains a very important cycle peak from the previous cycle and also some important monthly Fibonacci levels. So overall on this weekly chart we still have upward momentum.

Our index's momentum is positive and there is no collapse similar to what we saw in the Russell index.

We will now move on to the daily chart. Therefore, this clearly remains the strongest among the major indicators. It reached a new record high of around 31,018 earlier today, and even after retreating from that level, it is still holding steady above the rising "Slim" bar and well above its 89-day moving average.

The short-term momentum is positive. Here is a reflection detector that colors our candles red, green, or gray depending on the momentum. It has remained positive since mid- September, and our reversal detector also shows positive momentum.

But just like the S&P 500, this is a mature daily cycle. We are moving towards an area where we must be vigilant for the possibility of a peak.