The Nasdaq 100 index has touched off new highs this Tuesday, driven by a surge in tech stocks as investors reacted to the US FDA’s advisory on halting coronavirus vaccinations with the Johnson & Johnson vaccine.
The technology sector of the Nasdaq 100 is up 0.15% at the moment as demand for the tech stocks heightens. Why is this happening?
The news from the US Food and Drug Administration calls into question the controversial safety issues with some of the coronavirus vaccines and dampens pessimism of early economic recovery from the coronavirus pandemic. At the height of the pandemic in mid-2020, tech stocks were the big gainers as their products became the go-to tools for remote work and education, amid worldwide lockdowns. The tech stocks have thus emerged as safe-haven assets for any COVID-related fundamentals that are negative for economic recovery.
Technical Outlook for Nasdaq 100
The intraday violation has taken the Nasdaq 100 to all-time highs at 13,963.1. However, the Nasdaq 100 is yet to achieve the confirmation required for a break of the resistance at 13904.2. This level needs to give way along with the 127.2% Fibonacci extension at 13928.7 for the index to push towards the 14200 psychological resistance. Above this level, 14435.6 (141.4% Fibonacci extension) also forms a potential additional resistance.
On the flip side, a rejection at the current resistance could lead to a pullback that targets 13801.9, with a deeper decline extending towards 13559.2. 13344.2 marks the neckline of the “W” pattern, with 13135.5 coming in closely behind as yet another support level.
Nasdaq 100 Index; Daily Chart
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