The Nasdaq 100 index has dropped almost 2.4% as the Coronavirus market fever appears to have spread from Asia to Europe and down to the US markets this Monday. The market slump seen in the Nasdaq, S&P 500 and Dow Jones indices all appear to be related to the global selloff that has marked the announcements of new cases of the novel Coronavirus.
The Nasdaq 100 is currently trading at 8979.2, which is well off this month’s all-time highs. However, the Nasdaq 100 is trying to claw back some of those losses, after gapping lower on market open.
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Technical Outlook for Nasdaq 100
The technical outlook takes a look at the daily chart, where we can see several identified price levels that the Nasdaq 100 has formed in the last three months on its way to the all-time highs seen this month. The markets were teetering on the edge of a profit-taking pullback and needed something to spur this selloff. The Coronavirus outbreak has given the markets just what they needed to instigate the downside moves seen in the last two days, with the bearish engulfing pattern providing just what sellers wanted to make their move.
The current support lies at 8960.2, and today’s price action has tested this area but has not broken below it. The last 4-hour candle bounced nicely on this area. We need to see two successive daily candles closing below this price level for the door to be open towards 8882.6 (previous intraday lows of 9 Jan/10 Jan 2020). This area also marks the daily highs of Jan 2, Jan 3 and Jan 7 2020. A further downside break of this area targets 8794.5 and possibly 8691.0 (lows of 30th and 31st Dec 2019 and Jan 6 2020).
On the flip side, a bounce of the market from present price levels could provide some impetus for a retest of 9092.0 (previous high of Jan 14 2020), with 9167.4 lurking overhead.
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