The Nasdaq 100 index (US Tech 100 mini on FXOpen) is showing clear signs of bearish pressure, with technology stocks dropping roughly 2% yesterday.
Factors Behind the Decline
Media reports suggest that the market is being influenced by developments in the AI sector:
→ Leading tech companies are significantly ramping up spending on infrastructure, but it remains uncertain when these outlays will pay off. For example, Google issued bonds this week, including 100-year debt.
→ AI’s disruptive effect on traditional business models, particularly within the software industry, is creating additional caution among investors.
Technical Outlook for Nasdaq 100
In our analysis of Nasdaq 100 price action on 2 February:
→ a resistance zone was marked (in orange) with a key barrier at 25,900;
→ we observed bears taking control and noted that maintaining dominance near 25,500 — the previous break point of the ascending channel — would be critical.
Bulls briefly pushed above this zone to retest 25,900, but the move proved short-lived, with prices quickly falling back, highlighting their inability to sustain gains.
A series of lower highs has allowed a descending trend line (R) to be established. If the recent consolidation reflects a temporary equilibrium between buying and selling pressure, a median line and a lower channel boundary can be plotted.
If the downtrend continues, the Nasdaq 100 may test new lows for the year. The extent of the decline will likely hinge on the US inflation report, with the CPI release scheduled today at 16:30 (GMT+3). Traders should expect increased volatility.
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