Technical Analyst, Saxo Bank Group
Seems like Portfolio Mangers are done cleaning house. Historically Portfolio Managers come back after the Labor Day weekend (early September) they get rid of stocks they do not want on the books going into the last quarter of the year. The selling pressure could be on pause for a few days and a minor rebound is in the cards. But be cautious, selling pressure could soon return
S&P 500 closed at lowest level in almost two years but did not break below the June lows at 3,636. The Index has been dropping for almost 10 days straight and is ripe for a correction. But do not expect a major reversal. A correction to around 3,800 before selling pressure resumes is likely.
Bottom fishers might get a little tailwind and try lifting the market higher toward towards key resistance at 3,900 but is not likely to have the power to test it. Trend is down and it would take a close above 4,308 to reverse that.
A close above 3,900 would merely just put it on pause. RSI is showing negative sentiment with no divergence indicating lower levels below 3,636 is likely.
A close below 3,636 will confirm the medium-term downtrend. Support at 3,509 but if this scenario unfolds a sell-off down to the consolidation area around 3,200 is likely.3,200 is close to the 0.618 retracement of the 2020-2021 uptrend and the 1.618 projection of the recent correction.
Nasdaq 100 did not drop to a lower close than the June close let alone testing June lows at 11,037. Yesterday’s market has formed an Inverted Hammer. In most cases it is a continuation candle but if market closes above either the inverted hammer high or the high of the previous candle (whichever is the highest) it usually acts as a bottom and reversal pattern i.e., if Nasdaq closes above 11,474 a correction up to around 11,769 -12,000 is likely. If closing above 12,062 a correction could extend to around 12,500.
However, the trend is down supported by rising volume the past 4 weeks, RSI is showing negative sentiment with no divergence, all indicating lower levels are likely.
If Nasdaq 100 closes below 11,037 there is some support around 10,677-10,580 area but lower levels below 10K are not unlikely.
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Fixed Income Strategy
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Commodity Strategy
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Fixed Income Strategy
Quarterly Outlook
Head of Commodity Strategy
Disclaimer
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)