The surge in US bond yields has caused a renewed slump in tech stocks. The Nasdaq 100 is down 1.57% after a huge rebound in the 10-year US Treasury yields, which are up 5.16% as of the time of writing.
The Nasdaq 100, like the other US stock markets, got a reprieve from the FOMC decision and rate statement. This statement dented hopes of an earlier-than-expected rate hike lift-off, but one missing ingredient was that there was no pushback on rising long-term real bond yields. The 10-year yield surged massively on Thursday as a result and put tech stocks into selling mode.
Technical Outlook for Nasdaq 100
Thursday’s drop has found support at the 12973.9 price level after the intraday violation of that price level was beat back by bulls. However, that price point remains vulnerable. A breakdown here allows bears free reign to march towards 12769.3, with 12489.7 and 12231.7 lining up as additional targets to the south.
On the other hand, a bounce on the present support lifts the tech index and makes an approach to 13135.5 a viable venture. Beyond this level, the price would need to surpass this week’s highs to hit 13344.2, with further advance needed to attain 13559.2. All-time highs at 13908.3 remain out of reach, at least until long-term bond yields cool off.
Don’t miss a beat! Follow us on Telegram and Twitter.
Nasdaq 100 Index; Daily Chart
More content
- Download our latest quarterly market outlook for our longer-term trade ideas.
- Follow Eno on Twitter.
- Do you enjoy reading our updates? Become a member today and access all restricted content. It is free to join.