Nasdaq 100 slides in early trading as the coronavirus lockdown stocks are under pressure as more and more businesses reopen in the USA. Amazon and Netflix give up over 2% while Peloton is 4% lower and Zoom gives up over 8%.
Rising tensions between China and the USA also weigh on stocks. President Trump said he would make an announcement later on the week regarding China’s new security laws in Hong Kong. China’s Foreign Ministry said it would retaliate at the U.S. if it took any action over the security laws.
Positive macroeconomic news failed to impress investors. The Richmond Fed Manufacturing Index rebounds sharply to -27 in May beating the expectations of -47. The three components of the manufacturing index, the shipments, new orders and employment came in above the April readings.
Earlier today, the MBA Mortgage Applications increase to 2.7% on May 22 from -2.6%. The Redbook Index came up to -1.5% on May 22 from previous -2.6%, while the yearly Redbook Index increased to -5.5% on May 22 from previous -9.5%
Nasdaq 100 is 1.32% lower at 9,215 as the index retreat from two-month highs, in a correction that for now keeps the rebound from March lows alive. The technical picture remains bullish despite today’s pullback, as the index trades above all major daily moving averages.
On the downside, Nasdaq 100 initial support stands at 9,144 today’s low. Next support area is at 8,843 the low from May 18th trading session. Below that level, the next critical support is at 8,719 the 100-day moving average.
On the other hand, the first resistance for Nasdaq 100 will be met at 9,362 the daily high. Next resistance stands at 9,504 the high from yesterday’s trading session. Next offer zone will be met at 9,710 the high from February 21st, trading session.