Nasdaq 100 Price Analysis — September 4

The Nasdaq 100 (NDX), Dow Jones (DJIA), and the S&P 500 (SPX) saw significant declines in yesterday’s trading session. Despite being ahead of the pack since the mid-March boom, tech stocks recorded the most losses yesterday, steering the NDX into a strong bearish retracement.

Some analysts have commented that the tech industry has been in a state of ‘euphoria’ for weeks now and that Thursday’s drop was a reminder of what stocks are. Two of the biggest losers of yesterday’s crash, Apple (NASDAQ: APPL) and Tesla (NASDAQ: TSLA), have been the biggest winners before now.

Tesla, which many believed to have been exhibiting bubble-like signs for most of this year, has seen its worst session since May. Continued weakness in the tech sector could dramatically turn the recent investor exhilaration to palpable fear.

That said, yesterday’s crash is not a replay of March’s ‘stock-Armageddon’ as many investors are claiming. September is usually a very erratic month for the equity markets as intense volatility has always been seen around this period for the past 40 years. Couple this with the current Coronavirus crisis and the upcoming US Presidential election and you can begin to understand the weighty volatility looming ahead.

Nasdaq 100 (NDX) Value Forecast — September 4

NDX Major Bias: Bearish

Supply Levels: 12000, 12420, and 12600.

Demand Levels: 11650, 11307, and 11160.

The NDX has seen a sharp drop over the past couple of hours as volatility picks up. Yesterday’s fall was strongly supported by the 11650 support, which helped the index approached the 11890 resistance again but failed to break above. That said, the effects from the NFP data report today will likely determine what the NDX will do next.

However, Nasdaq 100 remains well within the range of our ascending channel.

Meanwhile, the tech index has now entered overbought conditions, which could extend its decline in the near-term.

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