Nasdaq 100: Rejection of key Fibonacci resistance at 11060/65 signals a correction lower – Credit Suisse
|Nasdaq 100 experienced a wild session yesterday with early strength extending to key flagged Fibonacci resistance at 11060/65, with the subsequent aggressive rejection resulting in the completion of a large and potentially significant bearish ‘reversal day’, which has the potential to finally signal a much overdue correction lower, according to economists at Credit Suisse.
Key quotes
“A wild session yesterday with early strength extending to our next flagged resistance/objective at 11060/65 – a key Fibonacci projection resistance – with the subsequent aggressive rejection resulting in the completion of a large and potentially significant bearish ‘reversal day’. Whilst this has clearly the potential to signal a much overdue corrective phase has finally begun, we believe we need to see more evidence of a follow-through from yesterday to confirm this is indeed the case.”
“Key for the rest of this week is seen support at 10529/478 – the low of last week and further price support. Below here on a closing basis is needed to reinforce yesterday’s session to keep the immediate risk lower with support seen next at 10342/29, then the 21-day average at 10270/50. A close below this latter area remains seen in our view as confirming a potentially protracted consolidation/correction is underway, with support then seen at 9743 next and with the 38.2% retracement of the rally from March at 9428.”
“Resistance at 10792/892 needs to cap to keep the immediate risk lower.”
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