Originally published by AxiTrader
Tech stocks lead the global stock market rally for much of the period of global stock market ebullience that has followed the election of President Trump and the emergence of the European economic recovery.
More recently however, the rally has stalled a little. And last night both the Nasdaq 100 and Nasdaq Composite index broke down below the uptrend lines from the Trumponomics rally which began last November.
Now of course, the announcement that the EU competition watchdog had fined Google (NASDAQ:GOOGL)'s parent Alphabet (NASDAQ:GOOG) 2.42 billion euros for breaching anti-trust rules was the catalyst for the latest round of selling. But it wasn't just Alphabet being beaten down the selling was broader than that.
So here we are with an important trendline break.
This is the first sign of an important turn in the market that opens up the possibility of a move toward my garden variety retracement at the 38.2% Fibonacci level.
In Nasdaq 100 terms that level is 5,385 while in Nasdaq composite terms the level is 5,839.
But there is level in both Nasdaq indexes which needs to break first - the recent lows - to confirm that a break is afoot.
In 100 terms it's the recent low at 5,634 while for the composite it's 6,107. So lets call it 30 and the figure.
A break would be decisive - both for Nasdaq but for global markets more broadly.
Have a great day's trading.