Nasdaq 100: Move below 9938/9879 to turn risks lower – Credit Suisse

Nasdaq 100 reversed very sharply lower on Wednesday from a whole cluster of medium-term resistances. Now, a break below 9938/9879 would set a small top to suggest a more protracted setback is starting, with the next support seen at 9490/73, per Credit Suisse.

Key quotes

“The Nasdaq posted a particularly aggressive reversal on Wednesday, rejecting as expected the long-term trend resistance from 2011 and the top of the daily BollingerBand at 10255. With the top of the weekly Bollinger band also just above at 10525 and with the index above what we see as its ‘typical’ extreme – 15% above the 200-day average – we stay biased towards a deeper correction lower from here, which is further reinforced by a bearish momentum divergence.” 

“Key for today’s session will be support at 9879, below which would complete a small top, with support seen next at the 21-day average at 9815/01, a close below which would further reinforce the downswing, with the next support then seen at 9490/73.” 

“Near-term resistance now moves to 10051, which ideally caps to maintain the near term downside pressure. Above here would signal a retest of the aforementioned key resistances at 10255.”