Nasdaq 100 gives up 6.62% at 7362 as the Fed failed to calm markets after the emergency rate cut yesterday before the Asian markets open. Fed slashed rates by 100 basis points to 0.0% – 0.25%. Fed also announced that will also buy back $700 million of Treasurys and mortgage-backed securities. Fed also activated swap lines with the Bank of England, Bank of Japan, Bank of Canada, Swiss National Bank and the European Central Bank.
IMF said that the organization is ready to mobilize $1 trillion lending capacity to help countries from the coronavirus outbreak, including offering $50 billion worth of loans to emerging and developing countries.
On the economic data, the US Empire State Manufacturing Index dropped to -21.5, below the expectations of 4, the lowest reading since 2009. The news from China was also disappointing; the industrial production dropped by 13.5% while the retail sales were down by 20% year over year.
Investors fear that fiscal and monetary policy measures can’t turn around the global economy, given the disruptions in travel, daily life, and business.
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Nasdaq Index Technical Analysis
Nasdaq has lost over 28% since the February all-time highs as the rapid correction drove the index fast into the bear market territory. The technical picture is bearish, and only a move above 8420 might cancel the negative momentum.
On the downside, the immediate support for the Nasdaq index will be met at 6,951 today’s low. Next support area stands at 6,555 the low from January 4, 2019. If the index breaks lower, the next support area is at 6,455 the low from January 3, 2019.
On the flip side, initial resistance for the index will be met at 7,422 the daily top. The next resistance level stands at 7,710 the high from March 12, trading session. More offers might emerge at 7,870 the high from March 13th trading session.
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