Selloff on Nasdaq 100 Continues; Index Could Drop Below 11,000
After a higher open, investors are selling off holdings on the Nasdaq 100 as the tech stocks continue to struggle. The Nasdaq 100 is now 1.22% lower and continues to see bearish pressure as risk aversion creeps back into the markets.
News just coming in via Reuters indicates that EU lawmakers are adamant about not approving any EU-UK trade deal that does not capture the full implementation of the Brexit Withdrawal Agreement. Yesterday’s negative performance in the Nasdaq 100, as well as the global stock markets, was triggered by the shock revelation of the Internal Markets Bill proposed by the UK. This bill is said to contravene aspects of the Brexit Withdrawal Agreement directly. The furore it has generated has continued to impact the markets in a negative fashion. The latest reaction of the Nasdaq 100 to the statement captures the market’s feelings about the Brexit imbroglio.
Not much has been heard from the coronavirus vaccine development front either. There is presently no deal in place for fresh fiscal stimulus from the US Congress. A lack of bullish fundamentals leaves sellers pushing the market unopposed, with the Nasdaq 100 set to post a second losing week in a row.
Technical Outlook for Nasdaq 100
Today’s selloff is threatening to take out the 11176.3 support. If this breakdown is successful, 10866.5 becomes the new target (11 August low). Below this level, 10505.4 forms additional support.
On the flip side, lack of follow-through selling could allow for a recovery which keeps the Nasdaq 100 above 11000. 11271.2 and 11562.1 remain viable upside targets in the short-term, but this will depend on a radical change in the prevailing market sentiment.