Tuesday, October 27, 2009 at 03:26PM | Asher Pinto
With around 40 minutes left until the close of the session, it looks like the Nasdaq-100 might finally be joining the other indices in having broken back below the level of the previous peak that it had put in place (in September).
Nasdaq-100 chart
The index had formed a peak at around the 1740 level in mid-September and then fell around 80-90 points before rallying to a new high, a couple of weeks ago. While the other indices fell below their mid-Sept peaks in the past week or so, NDX had managed to stay stubbornly above the 1740-mark until today.
If the index closes below that mark today, another cog will have been added to the wheels of the bearish camp. Their work won't be done as yet, however. Notice that the index can still find potential support from its 20dMA, the lower line of the drawn price channel and from the centerline on RSI.
So traders have a few things to look at, before considering going all-out on the short side, without taking a bit of a risk in doing so. The intermediate trend is still clearly bullish and a lot more damage will need to be done before that changes, so a tight leash will need to be kept on bearish options picks and short stock pick for now.
« Nasdaq Last To Fall Back Below September Highs »
With around 40 minutes left until the close of the session, it looks like the Nasdaq-100 might finally be joining the other indices in having broken back below the level of the previous peak that it had put in place (in September).
The index had formed a peak at around the 1740 level in mid-September and then fell around 80-90 points before rallying to a new high, a couple of weeks ago. While the other indices fell below their mid-Sept peaks in the past week or so, NDX had managed to stay stubbornly above the 1740-mark until today.
If the index closes below that mark today, another cog will have been added to the wheels of the bearish camp. Their work won't be done as yet, however. Notice that the index can still find potential support from its 20dMA, the lower line of the drawn price channel and from the centerline on RSI.
So traders have a few things to look at, before considering going all-out on the short side, without taking a bit of a risk in doing so. The intermediate trend is still clearly bullish and a lot more damage will need to be done before that changes, so a tight leash will need to be kept on bearish options picks and short stock pick for now.