Nasdaq Retraces Half the Drop

3 февр. 2022 г.

The Nasdaq-100 has rebounded following a sharp drop. It’s a good time to consider where things stand with the tech-heavy index.

First, Wednesday’s close represented almost exactly a 50 percent retracement of the decline from December 28 through January 24.

Second, consider that it halted at the January 10 low. Will this old support become new resistance?

Next, the level was also near the 200-day simple moving average (SMA).

Fourth, the news cycle may be less favorable going forward. Positive results from Apple, Microsoft and Alphabet are in the rearview mirror. Meta Platforms tanked last night. Amazon.com, which has also struggled lately, follows this afternoon. After that, the next big names are two weeks away: Nvidia and Cisco Systems.

Finally, as noted on January 14, NDX has broken a 13-month trend line on the heels of some bearish patterns. Also, as noted on January 25, a period of chopping consolidation could follow such a drop. Now that prices have rebounded, is the next phase another probe of the lows as a range plays out?

TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.

Important Information
TradingView is not affiliated with TradeStation Securities Inc. or its affiliates. TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.

This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.

Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.