NDX100 setting up for a bounce?
Hi traders, I’m sure you all would have heard about or seen the sell-off on the Nasdaq. Today we heard more details about the selling that starts to make some sense of it. As in the first stage reasons for the selling weren’t very apparent.
News of Softbanks ‘gamma squeeze’ could be a big part of the sell-off seen on tech stocks over the last 4 days. With the squeeze over, dealers look to have dumped billions of dollars worth of delta hedge tech stocks they no longer need resulting is heavy declines on the NDX100. Robinhood traders have been singled out in tasting their first real run of red days in a row after months of rallying.
The selling kicked off on the 3rd of September with the first real plunge lower. From the third, we’ve seen 10% taken off in fourth trading sessions. Price has started to settle today after testing 10920 previous support. If this can continue to hold and if we see today’s rally carry though tonight’s NY session. That might be signs that new fightback rally could be starting. it could be a good sign to see buyers break the current short-term downtrend.
If today’s rally fails we will be looking for the short term downtrend to continue. Support is a small line in the sand atm.