Nasdaq 100

Nasdaq 100 Index (NQ) Futures Struggling to Recover from Meltdown

  • Nasdaq 100 index (NQ) faces bearish pressure with a 27% loss from year to date.
  • Tech giants have seen a shift in their positions amid the recent meltdown.
  • Fed’s aggression to curb inflation seems not to work. So rate hike plan may be fueled by the Fed.

The Nasdaq 100 index (NQ) futures were expected to increase 2 percent after the bell in New York, while the broader Nasdaq Composite has been down 27 percent since the start of the year.

However, the index managed to pare off some losses and is trading at 11,945.50, down 0.18%, at the time of writing.

A market crash this week has changed several tech milestones. Apple Inc. is no longer the world’s most valuable company, Inc. has experienced its longest losing streak in 14 years, and the Nasdaq 100 (NQ) is on track to reach its target. Since January, this has been the biggest burglary week.

There was a brief period of optimism during Friday’s rally, according to some investors, amid a longer downtrend.

Antoine Lesne, an investment strategist at SPDR State Street ETFs, noted that there have been a lot of tough weeks, and the market has tried to bounce back on occasions.

According to Florian Yelpo, multi-asset portfolio manager at Lombard Odier, the market sentiment is “so bearish everywhere you look,” and a recovery is likely in the coming weeks.

“Will it be sustainable through the end of the year?” he asked. “We strongly disagree. Only a slowdown in economic activity is the only way to avoid this inflationary scramble.”

Likely, inflation will not reach the 2 percent target without “some problems,” according to Federal Reserve Chairman Jay Powell. Last week, the Federal Reserve increased interest rates by 0.5 percentage points, and it is expected to raise them again in June, July, and September by the same amount.

For April, the Consumer Price Index rose 8.3% year-on-year, remaining close to its 40-year high of 8.5% from a month earlier.

As traders evaluated the impact of lingering inflation on a fixed income, they reversed a short-term rally in US Treasuries on Friday.

Nasdaq 100 index (NQ) futures technical analysis:

Nasdaq 100 index (NQ) futures 4-hour chart
Nasdaq 100 index (NQ) futures 4-hour chart

The Nasdaq 100 index (NQ) price attempts to rise from the lows of 11,703.43. However, the downtrend remains intact as the price stays well below the 20-period SMA on the 4-hour chart. If the price finds some traction, it may soar towards the 20-SMA near 12,645.43 ahead of horizontal resistance at 12,729.57.

However, the probability of a meaningful recovery is low as the recent pullback from the lows lacks follow-through momentum.