Nasdaq 100 Trades Lower As Bulls Take Profits After 53-Day Run

After Friday’s bullish move into all-time high territory following a Non-Farm Payrolls report that stunned the markets, the Nasdaq 100 index appears to be taking a breather on Monday. The Nasdaq 100 briefly touched off all-time highs at 9876.6 before giving up those gains very quickly. The 0.33% drop that the Nasdaq 100 is seeing today could be as a result of fatigue on the part of the bulls, some of whom may want to take some profits off the table after a bullish run that lasted for 53 days.

Top on the list for news about Nasdaq-listed stocks is a Bloomberg News report which indicated that UK drug company AstraZeneca had approached Gilead Sciences last month over a possible merger. Gilead Sciences stocks rose as much as 4.5% in the premarket trading session, but has lost most of those gains and now trades 1.25% higher. 

Facebook, Alphabet and Apple stocks have made an underwhelming start to the day, but Tesla stocks got further boost after it saw its sales in China jump 205%, making it the top-selling Chinese EV brand in May 2020. This news prompted a 4.22% rise in the stock, sending it above $923. However, the gain was not enough to stop today’s slide on the Nasdaq 100, which is now struggling to cling on to the 9800 price level. 

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Technical Outlook for Nasdaq 100

The Nasdaq 100 is seeing a price rejection off the upper border of the ascending channel on the daily chart. A further retreat may allow the index asset to target the lower edge of this channel, which may touch off the 9626.4 and the 9452.0 support levels on the way down. Further support targets exist at 9264.4, 9167.4 and 9092.3, but their relevance to ongoing price action is now subject to the confirmation of the breakdown of the channel. 

On the flip side, a resumption of the upside move could take the Nasdaq 100 further into uncharted waters, with the 2.0 Fibonacci extension price of 9860.4 presenting itself as possible resistance. Further upside targets are seen at the Fibonacci extension levels of 2.272 and 2.414, corresponding to the 10294.4 and 10521.0 price levels. However, attainment of these price levels depends on the break of the 10000 psychological resistance as well as the channel’s upper border.

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