The NASDAQ 100 initially tried to rally Monday but has also failed just above the 50-day EMA. Pulling back the way we have, it does suggest that we are not ready to take off yet, and I’m keeping an eye on the 12,250 level to determine if there’s any real strength. Ultimately, I think this is a market that is probably going to go sideways for a while, so I do favor selling it, but truthfully I think this is more or less range-bound nonsense.
Looking at this chart, if we do drop I think we could fall to the 11,600 level, which is where we bounced from a few days ago. The market will continue to see a lot of noisy behavior because quite frankly there are people out there that believe the economy is perfectly fine, while others think that we are going to see a lot of recessionary headwinds, and perhaps more negativity. The Federal Reserve is going to tighten rates as much as they need to, and it’s likely that eventually, the technology stocks will continue to show major problems.