Nasdaq 100 Continues Slump Amid Worsening US Coronavirus Numbers

nasdaq 100 index

The worsening domestic coronavirus epidemic is affecting investor sentiment in the US markets, with bears on the Nasdaq 100 assuming full control in today’s session. Positive earnings numbers by JPMorgan Chase and Citigroup have done little to calm investor fears, which are also being stoked by worsening relations between Washington and Beijing. 

The tech-heavy index is down 1.6% as the US and China set off a new round of confrontations over a US upgrade consignment of missiles to Taiwan. China has always considered Taiwan as part of its territory and has vehemently opposed any form of US support for the government there.

Technical Outlook for Nasdaq 100

Yesterday’s bearish close after posting initial record highs meant that a bearish engulfing setup is complete. This is why today’s session started on a bearish note, and even though bulls are attempting a comeback, the Nasdaq 100 is under pressure. 

However, the former all-time high at 10307.3 is now acting as a support. A further downside extension on the Nasdaq 100 will depend on a breakdown of this level. So far, this has not happened, but a bearish close today forms the 3-candle outside reversal, which has more bearish implications. This candle formation could then trigger a further decline to 10156.5 and possibly 9867.1. Attainment of 9867.1 and other support targets below such as 9730.2 and 9626.4, will depend on the breakdown of the channel, which has been the guide for price action since mid-April. 

On the flip side, if the bulls can re-establish upward momentum that breaks above 11069.6 (yesterday’s all-time high point), then the Nasdaq 100 can make new records well above the 11,000 mark. But so far, the bears are in control, and the worsening domestic coronavirus situation could continue to be the determinant of the market sentiment for the rest of the week.

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Nasdaq 100 Daily Chart

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