The Nasdaq is exhibiting signs of weakness after retreating from the upper bounds of Bollinger Bands. This movement suggests that the previous bullish momentum is beginning to fade, presenting an opportunity for the index to continue its downward trend. Furthermore, the Stochastic indicator, which has started to decline from the oversold zone, reinforces the signal for potential further declines.
Bollinger Bands are frequently utilized as a tool to identify overbought and oversold areas, and a drop from the upper limit indicates selling pressure. Although the Stochastic is in the oversold territory, this might also suggest that the Nasdaq still has room to drop before finding new support.
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Consistent with the analysis from the hourly chart, the 15-minute chart above also indicates a potential decline as the price is currently situated within a bearish channel with the moving average indicator trending downwards, adding downward pressure. If the scenario plays out accordingly, the Nasdaq may test the support level at 21.070.
Technical Reference: sell as long as it stays below 21.490
Potential Stop Loss 1: 21.422
Potential Stop Loss 2: 21.490
Potential Take Profit 1: 21.155
Potential Take Profit 2: 21.070
