Hump day may end up being slump day if yesterday’s close below 6,193
on the NASDAQ Composite ends up proving our recent analysis correct.
It’s still a little too soon to tell, however, we’ve been talking about
the possibility of the markets staging a much bigger selloff than
anything we’ve seen in a while.
The technical context we pointed to yesterday in order for the NASDAQ
to be in a position to resume its June 9th selloff was a close below
6,193 on the Composite. We also mentioned a bullish trigger should the
index close above roughly 6,255, but that hasn’t happened yet.
It’s still possible the index could reverse itself back to the upside, and more importantly take out that 6,255 level, but based on what happened yesterday, there’s strong technical context at this point to believe these markets may finally start moving lower now. We’re not out of the woods quite yet, but one more strong move lower as soon as today could end up triggering a resumption of that June 9th selloff – one that pulled the rug from many big tech names all in a single day.
Just goes to show the major indices – and even individual stocks – often move lower far faster than they move higher, especially in the type of market environment we’ve got right now. There’s no question stocks have gotten a little long in the tooth – both technically and fundamentally – but it still remains to be seen if they’re truly ready to rollover for a while.
We’re assuming we’ll find out this week, so for those of you who got short any of the bearish index ETF’s in recent days, just remember if the NASDAQ Composite closes above 6,255, all bearish bets for the time being should be taken off the table. However, as long as the level is not breached to the upside, these markets will still be in a position to move lower.
Biotech continues to rip higher following our bullish analysis earlier this month regarding LABU – one of the bullish leveraged ETF’s tracking the sector – and the biotech space in general.
It’s still possible the index could reverse itself back to the upside, and more importantly take out that 6,255 level, but based on what happened yesterday, there’s strong technical context at this point to believe these markets may finally start moving lower now. We’re not out of the woods quite yet, but one more strong move lower as soon as today could end up triggering a resumption of that June 9th selloff – one that pulled the rug from many big tech names all in a single day.
Just goes to show the major indices – and even individual stocks – often move lower far faster than they move higher, especially in the type of market environment we’ve got right now. There’s no question stocks have gotten a little long in the tooth – both technically and fundamentally – but it still remains to be seen if they’re truly ready to rollover for a while.
We’re assuming we’ll find out this week, so for those of you who got short any of the bearish index ETF’s in recent days, just remember if the NASDAQ Composite closes above 6,255, all bearish bets for the time being should be taken off the table. However, as long as the level is not breached to the upside, these markets will still be in a position to move lower.
Biotech continues to rip higher following our bullish analysis earlier this month regarding LABU – one of the bullish leveraged ETF’s tracking the sector – and the biotech space in general.
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