The Nasdaq has come under selling pressure after failing to achieve a higher high in its recent movements, indicating a weakening of buying strength. This inability to create a new peak suggests the possibility of a reversal pattern or at least a short-term correction. This pressure has arisen amidst growing market skepticism regarding the continuation of the previous rally, which seems to be losing momentum near a crucial resistance zone.
The Commodity Channel Index (CCI), which has fallen from the overbought area, further strengthens the signal that the upward momentum has reached saturation. A declining CCI from the overbought level usually marks the beginning of a distribution phase or a technical correction. If selling pressure persists without significant buying support, the Nasdaq could potentially trend lower in the near future, testing nearby support levels to determine the next direction.
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The Nasdaq shows signs of further weakness after successfully breaking low from a bearish channel, which serves as an important technical signal that selling pressure is beginning to dominate. The Moving Average (MA) is also starting to trend downwards, reinforcing the indication that the short-term trend is reversing downward. Meanwhile, the MACD is in negative territory, signaling a continuing bearish momentum. With this combination of signals, the Nasdaq has the potential to drop further tonight, testing important support around the 23,115 level.
Technical Reference: sell below 23.37
Potential Stop Loss 1: 23.332
Potential Stop Loss 2: 23.375
Potential Take Profit 1: 23.168
Potential Take Profit 2: 23.115
