FOREXcom

Nasdaq remains under heavy pressure

Short
FOREXCOM:NSXUSD   US Tech 100 CFD
The Nasdaq broke back below the June low and support around the 10890 to 11036 area, after the rebound we saw in October faded before plunging on the back of a very hawkish Powell on Wednesday.

This is a bearish development, which strongly suggests we might see a new low on the year beneath the October low at 10432.

After bouncing off their worst levels earlier, the Nasdaq and other US stock indices are likely to resume lower following a big plunge in the aftermath of the FOMC’s fourth consecutive 75 basis point rate increase on Wednesday.

We have seen more signs of weakening economic data today, which is not great for businesses and company earnings . In the past, the “bad news = good news for stocks” equation used to trigger a positive response in stock prices.

But this no longer applies, because of the very high levels of inflation preventing the Fed from pivoting to a dovish stance.

As Powell made it clear yesterday, the Fed expects to raise interest rates even higher than previously expected – because of inflation remaining stubbornly high and employment remaining strong.

By Fawad Razaqzada on behalf of FOREX.com

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