Figure 2: The NASDAQ on a daily chart
From the daily chart we can clearly see the bearish trend, when the so-called death cross was created at point 1, when EMA 50 came under SMA 100. In point 2, EMA 50 even came under SMA 200.
In the bearish trend, it is better to look for trades to speculate on the decline. However, it does not seem that the current correction wants to stop. The price is now near the level of interesting resistance at Fibo 61.8%, but we have no confirmation of movement change. Confirmation can be on the H1 chart when EMA 50 falls below SMA 100 or eventually when the price closes below the ascending line defined by points BE.
is in the band of 8,500 – 8,600. Here, there is Fibo 61.8% of the decrease between points A and B. At the same time it is the level on which the daily chart EMA 50 fell below SMA 100 and thus confirms the downward trend. Currently, it is also the level where the average SMA 100 is. It is also the level from which the previous strong decline was initiated, so it is possible that this will happen again.
is in the zone 9,050 – 9,100. It is a Fibo level of 78.6% of the decrease between points A and B.
is in the region 7,900 – 8,000. There is a break of previous resistance.
is in the band 7,370 – 7,460.
The SP 500 Index
There is a correlation between the NASDAQ and the SP 500, but there are interesting differences between them. While the NASDAQ is above the moving averages on the weekly frame, the SP 500 is still below EMA 50 and below SMA 100 as shown in Figure 3