Back on March 2nd, I highlighted some technical reasons why I believed the rally in the Nasdaq Composite had limited upside. I was a bit early, but the levels and commentary have held true thus far.
In that post, I highlighted 4 technical resistance levels that could limit the Nasdaq’s near-term upside from that point to 2 to 5 percent. At that point, the Nasdaq was trading at 4693. It’s now 4869 (or 3.7 percent higher).
And it’s worth noting that we are making our way into a thick band of price resistance. Rather than rewrite all the technical levels, here’s an excerpt from the post on the Nasdaq Composite:
More specifically, there are 4 key overhead levels to note (see chart below for reference):
1). The 50 percent Fibonacci retracement of the December 2 high to February 11 low is 4693… roughly where we stand right now.
2). The next resistance level is the 61.8 percent Fibonacci level at 4807. That’s a little over 2 percent away (and a likely target near-term).
3). The 200 day moving average is at 4893. That’s roughly 4.2 percent away and would be a secondary target.
4). Massive overhead supply zone between 4875 and 5000.
Note that we recently surpassed the 61.8 Fibonacci level. We currently sit just under the 200 day moving average… but more importantly, we are moving into the thick area of overhead supply between 4875 and 5000. A rest here seems logical.
Here’s the updated chart of the Nasdaq Composite from that post.
Thanks for reading and trade safe.
Read more from Andy: “Apple Stock Chart Across Multiple Time Frames“
The author does not have a position in any mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.