The Nasdaq 100 index (US Tech 100 mini on FXOpen) came under heavy selling pressure yesterday, with the chart showing a decline of roughly 1.6%.
According to market commentary and media reports, the growing bearish sentiment is closely linked to the anticipation of several key macroeconomic events:
→ Later today, at 21:00 GMT+3, the minutes of the latest FOMC meeting will be released.
→ On Friday, attention will turn to Jerome Powell’s speech at the Jackson Hole symposium, with investors keen to hear the Federal Reserve Chair’s guidance on the future trajectory of interest rates.
While the Nasdaq posted a steep loss, the S&P 500 recorded a much smaller decline, and the Dow Jones Industrial Average was almost unchanged. This divergence between indices carries two important implications:
→ Technology stocks may be excessively overvalued, inflated in part by the ongoing hype surrounding artificial intelligence.
→ At the same time, market participants appear to be rotating capital away from riskier assets — including cryptocurrencies — into perceived safe havens.
The question now is whether technology stocks, already under pressure, could see further declines in the near term.
Technical Analysis of the Nasdaq 100 (US Tech 100 mini on FXOpen)
In our 5 August analysis, we identified and outlined the primary ascending channel (highlighted in blue). That broader technical structure continues to remain in place, and since then the price action has unfolded within its boundaries. Specifically, the index has:
Yesterday’s session, however, brought a decisive move lower, with the index touching the lower boundary of the channel.
From a bullish perspective, several technical factors could still provide support for buyers:
→ The possibility of an uptrend resuming from the lower channel boundary, similar to the price reaction seen in early August.
→ The presence of the 50% Fibonacci retracement level following the A→B impulse, which is situated near the current trading zone.
→ Indications of a potential rebound from the RSI, which has entered the oversold area.
→ Support around the 7 August low of 23,250, which could once again act as a floor and might even produce a false bearish breakout.
From a bearish standpoint, however, the evidence currently appears more convincing:
→ The price has broken decisively below the channel’s median line and then accelerated downwards, creating an imbalance in favour of sellers.
→ This imbalance has left behind a technical zone that, under Smart Money Concept methodology, can be classified as a bearish Fair Value Gap — and such zones frequently act as resistance during subsequent rallies.
Considering the speed and strength of yesterday’s downward move, it is reasonable to assume that sellers currently hold the initiative. If the market only manages weak recoveries — resembling so-called “dead cat bounces” — from the channel’s lower boundary, the probability of a sustained bearish breakout and further downside momentum will increase.
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