Nasdaq 100 rout continues while EUR/USD rally stalls and WTI stabilises
Technical analysis of the Nasdaq 100 as it continues to drop while the EUR/USD advance stalls and WTI stabilises above last week’s lows.
Macro update
Wall Street declines:
US equities sold off sharply, with the S&P 500 and Nasdaq 100 breaking below their 50-day moving averages for the first time since April.
Nvidia in the spotlight:
Nvidia shares eased ahead of Wednesday’s earnings, as stretched artificial intelligence (AI) valuations came under scrutiny following reductions in holdings by prominent investors.
Jobs data now key:
With the US government shutdown over, traders turned their attention to Thursday’s delayed September employment report.
Tech downgrades drag:
Dell and Hewlett Packard Enterprise dropped sharply after broker downgrades, while Alphabet gained more than 3% after Berkshire Hathaway disclosed a new position.
Asia follows Wall Street lower:
Regional equities weakened, with Japan’s Nikkei 225 sliding 3.2% as chipmakers led the decline.
Japan policy concerns rise:
A weakening yen and expectations of a sizeable fiscal stimulus pushed long-dated Japanese government bond yields to their highest levels since 1999.
Nasdaq 100 drops like a stone
The Nasdaq 100's fall through Friday's low doesn't bode well for the bulls with the late September and October lows at 24,257-to-24,187 being on the cards.
Were this support area to give way on a daily chart closing basis, a medium-term top may be in the process of forming.
Minor resistance sits between the 22 October and 7 November lows at 24,604-to-24,652 and may also be seen along the 55-day simple moving average (SMA) at 24,916.
Nasdaq 100 daily candlestick chart
EUR/USD is giving back recent gains
EUR/USD's advance from its $1.1469 early November low paused at last week's $1.1656 high with the cross trading back below the $1.1600 mark.
Minor support around the 22 October low at $1.1577 may be revisited and perhaps also the early-to-mid-October lows at $1.1542 while now rise above $1.1656 is seen.
Were it and the late October high at $1.1668 to be exceeded, the mid-October high at $1.1728 would be next in line.
EUR/USD daily candlestick chart
WTI tries to recover
WTI continues to range trade but whilst doing so is seen bouncing off last week's $58.12 per barrel low whilst aiming for the early October low at $60.40.
If overcome, the 11 November high at $61.28 and the early September low at $61.45 may be back on the cards, together with the early November high at $61.50.
Minor support sits at the early November $58.83 low.
A bullish reversal and rally above the $61.50 early November high is needed for the late October peak at $62.59 to be back in play. Only a rise and daily chart close above this level and the 8 October high at $62.92 would put the bulls back in control.
WTI daily candlestick chart
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