After a poor second quarter, growth companies will try to outperform value stocks, according to the Nasdaq 100. Falling US Treasury yields may help growth stocks even more. There are regulatory hurdles, but they are not a huge issue at this time. View each DailyFX Analyst’s favorite trades for the third quarter. From the DailyFX Free Trading Guides, download our new 3Q top trading chances guide! During the first five months of the year, the Nasdaq 100 was in an unusual position, trailing its industrial counterpart, the Dow Jones, due to the ongoing reflation trade. The deal was a hot topic on Wall Street, with the Nasdaq 100 to Dow Jones ratio collapsing as the Industrial Average outperformed the tech-heavy Nasdaq. Growth to Value Barometer: Nasdaq 100 to Dow Jones The Nasdaq 100 could recover its throne as the top of the US indices now that the reflation trade has been halted and an impending rotation back into fast-growing technology sectors. Looking at the Nasdaq 100 price chart in particular, recent price activity has seen the index reach a new all-time high, continuing a trend of higher highs. The Nasdaq 100’s technical landscape appears to be supportive of future increases, as it trades above all longer-term moving averages and significant rising trendlines. Daily Time Frame Nasdaq 100 Price Chart (January 2020 – June 2021) Peter Hanks prepared the chart, which was made with IG. As a result, given its lack of overhead resistance, the Nasdaq 100 may have a pretty simple route higher. Support, on the other hand, might be located along a succession of swing-lows dating back to September 2020, which could help the Nasdaq 100 climb even higher. While the fundamental and technical landscapes appear to be positive, there are still concerns to be aware of. First, seasonal market headwinds may make it tough to achieve more topside momentum as volume and volatility decline. In such a scenario, range-bound price action may become more prevalent, which may serve as good consolidation in the long run. Regulatory Risks are Increasing Aside from seasonal worries, the Nasdaq 100 will have to deal with increasing regulatory scrutiny. Substantial technological businesses have been under fire from both sides of the political aisle in the United States for a variety of reasons, including monopolistic behavior and sophisticated tax avoidance strategies that have sheltered many of the world’s largest corporations from large tax liabilities. Should big-tech legislation gain traction, the Nasdaq 100’s top companies might be targeted, resulting in uncertainty and volatility for the entire index. Nonetheless, such legislation has been a topic of discussion for months, with little progress. As a result, there is little reason to believe that real action harming growth prospects is forthcoming, providing an opportunity for investors to examine the positive fundamental and technical backgrounds. View each DailyFX Analyst’s favorite trades for the third quarter. From the DailyFX Free Trading Guides, download our new 3Q top trading chances guide!/nRead More