Nasdaq 100: Can Nvidia’s Earnings Beat Outweigh Bond Market Blues?

The leapt higher overnight, fuelled by Nvidia’s stellar earnings report and a US court decision that ruled most of Trump’s China tariffs unlawful. On the surface, that’s a solidly bullish mix—less trade friction and a tech titan exceeding expectations. But there’s a shadow looming in the form of bond yields, which are inching back above the psychologically sensitive 5% mark on the .

Japan’s is also nudging the 3% threshold, and if that trend persists, it could prompt a shift to risk-off positioning. Already, fell over 100 pips from its overnight peak, and indices like the turned negative on the day. That said, US futures remained broadly in positive territory at the time of writing.

Nvidia’s Glow Lifts the Nasdaq 100—for Now

Nvidia’s (NASDAQ:) performance continues to be a major driver of sentiment. The shares surged 6.5% in after-hours trading following an upbeat revenue forecast, brushing aside concerns about softer Chinese demand.

The company’s plans to scale up production of its new Blackwell chips added another layer of optimism for the AI camp. That enthusiasm carried the broader higher, and other major index futures followed suit—highlighting just how influential Big Tech has become in steering market mood.

It wasn’t just tech exuberance doing the heavy lifting. The tariff ruling also offered markets a glimmer of relief. A reduction in trade tensions could, in theory, support global growth—and by extension, corporate earnings.

Rising Yields Threaten to Undermine the Tech Rally

Here’s where the bullish momentum for the Nasdaq 100 could run into resistance. As tech stocks rally, the bond market is painting a more cautious picture. The US 30-year yield creeping back above 5% has historically been a cue for broader risk aversion. That’s perhaps why gold has bounced sharply from its $3250 support.

Moody’s recent downgrade of the US’s final top-tier credit rating only adds to the concern. Investors are growing increasingly wary of escalating debt levels and excessive government spending, and are hedging their bets—selling off Treasuries and the dollar, while turning to gold and foreign currencies.

Japan’s Quiet Storm

And then there’s Japan. The country’s ultra-long government bonds are under fresh pressure. They had found some support after news emerged that the Ministry of Finance plans to shift issuance towards shorter maturities. That short-lived reprieve has faded, with longer-dated Japanese bonds now seeing some of the weakest demand in years.

The Bank of Japan—still the largest single holder of JGBs—has been gradually trimming its balance sheet, reducing holdings by some ¥21 trillion since late 2023. But without the BoJ propping up demand, the latest auctions for and bonds have been underwhelming, driving yields higher.

What happens in Japan no longer stays in Japan. The BoJ faces a tightrope walk: manage without destabilising markets. As it weighs a review of its bond-buying programme in June, the outcome could reverberate globally. Higher Japanese yields could draw capital away from the US, threatening to unwind carry trades.

Nasdaq 100 Technical Analysis and Levels to Watch

Now, while the macro concerns are there, so far this hasn’t been reflected in a renewed drop in stock prices. If anything, the latest breakout above the 21,500 level on the Nasdaq 100 futures chart is another bullish sign. The key question is whether this breakout will hold, or we go back below it.

If the market were to drop back below it, then that could put the bulls in a spot of bother. In that potential scenario, we could well see a healthy pullback. The next support below 21,500 is at 21,220, below which is the most recent low at 20,727.

On the upside, not many obvious resistance levels are left to watch thanks to this strong recovery. The psychologically important 22,000 is the next potential hurdle, followed by the last all-time high at 22,425.

Meanwhile, the RSI is pushing into the overbought levels of 70 again, which may encourage some profit-taking around these levels.

In summary, the trend is still bullish, and dip-buying in this trade has worked until now. But with yields rising, watch out for a possible failure of dip-buying strategies. At that point, counter-trend trading strategies might be the way to go.

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