Nasdaq 100 Index Hovers at $20,398 Amid Profit-Taking and Tech Sell-Off
The Nasdaq 100 Futures face downward pressure, hovering around 20,428.25 with an intra-day low of 20,415.50. This decline is primarily due to profit-taking and cautious investor sentiment, especially in the technology sector.
Heavyweight tech stocks, which have been driving market gains, are now experiencing selling pressure ahead of upcoming earnings reports. Meanwhile, concerns over high valuations and potential regulatory scrutiny have also contributed to the index’s decline.
Wall Street indexes fell sharply on Thursday as investors opted to lock in profits in heavyweight tech stocks that have recently outperformed on the artificial intelligence boom, causing the tech-heavy Nasdaq to plunge. #TechStocks #AI #StockMarkets pic.twitter.com/celAxazug7
— New Zealand Digital Asset Exchange (@nzdOne) July 12, 2024
Moreover, uncertainty surrounding expectations of Fed rate cuts and geopolitical tensions are further weighing on the Nasdaq, keeping it subdued.
Impact of Expectations of Fed Interest Rate Cuts on Nasdaq
Market sentiment has been influenced by growing expectations that the Federal Reserve will begin cutting interest rates as early as September. Recent comments from Fed officials, including Chair Jerome Powell and Fed Governor Adriana Kugler, have reinforced these expectations.
However, the prospect of lower interest rates tends to benefit growth-oriented sectors initially, but the uncertainty surrounding the timing and extent of rate cuts has added volatility to tech stocks, which are sensitive to changes in borrowing costs.
Conflict Between Israel and Gaza and Its Impact on the Nasdaq Index
On the geopolitical front, the escalating conflict between Israel and Gaza has introduced significant uncertainty into global markets. As per the latest report, 48 people were killed in three Israeli airstrikes within an hour on Tuesday.
The strikes targeted a UN-run school in central Gaza’s Nuseirat area, resulting in 25 deaths, while 18 were killed in southern Khan Younis and five in Beit Lahiya in northern Gaza. The UN’s humanitarian operation center in Deir el-Balah was also hit.
🚨Breaking🚨
Fresh Israeli massacre in Nusyrat in the middle of the Gaza Strip, killing and injuring dozens of Palestinians when an Israeli air strike targeted a UN-run school sheltering thousands of displaced Palestinians.
The Israeli ugly genocide continues for 265 days so far.… pic.twitter.com/wXmaBN5qh5— Yousef Alhelou (@YousefAlhelou) July 6, 2024
During the nine-month conflict, 70% of UNRWA schools in Gaza have been bombed, with 539 people killed while seeking shelter there.
Israel’s military actions in Gaza since October 7 have led to at least 38,713 deaths and 89,166 injuries, while 1,139 have died in Israel due to attacks by Hamas, with many still held captive in Gaza.
NASDAQ Price Forecast
As of July 17, the Nasdaq 100 Index is trading at $20,398.62 on a 2-hour chart timeframe. The pivot point is at $20,311.97.
Immediate resistance levels are at $20,531.34, $20,693.61, and $20,837.85. Immediate support is $20,213.77, followed by $19,996.43 and $19,856.95. The RSI is at 52.84, indicating neutral momentum. The 50 EMA stands at $20,213.77.
Conclusion:
The current entry price for a potential sale is below $20,311.97, with a target take profit at $20,170.73 and a stop loss at $20,531.34.
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