The Nasdaq Composite closed just ever so slightly back above its 200 day moving average on Friday. While some of the index’s perceived “untouchables,” such as $AAPL and $AMZN, may be vulnerable here, there have indeed been many stocks in the Nasdaq that have held up remarkably well in this downturn, such as $CSTR, $FFIV and $RBCN. The updated and annotated daily chart of the index, seen below, illustrates the crucial levels of overhead resistance suddenly at the forefront.
Looking forward, I see a few possible scenarios, seen below. I have denoted my scenarios with the light blue lines. Note that some of them may seem to overlap in certain aspects. Feel free to chime in with your own scenarios as well.
The bottom line is that the bulls have a lot of hard work ahead of them, if they are going to put together anything more than a dead cat bounce. However, keeping an open mind is crucial, so as to not let your bias prevent you from taking advantage of opportunities.Twitter