Equities Watchlist: NASDAQ Bearish Momentum Picking Up?


 Feeling bearish on U.S. equities lately?

Stock indices have closed in the red for back-to-back days so far this week, possibly paving the way for another leg lower.

Can the NASDAQ bust through this near-term floor and aim for the next support zone?

NASDAQ (NAS100): 1-hour

The equity index is currently stalling at its mid-channel area of interest, after hitting the ceiling at the top of its descending channel.

This happened to line up with the 100 SMA dynamic resistance, which is still below the 200 SMA to confirm that bearish vibes are present.

Stochastic is also flashing bearish signals since the oscillator is heading south. It’s closing in on the oversold region to reflect exhaustion among sellers soon, though.

Rising bond yields buoyed by higher U.S. interest rate expectations seem to be drawing investors away from equities lately. If this keeps up, we might just see a break below the previous week’s low and a continuation of the selloff until the channel bottom near 11,500.

Don’t forget that the U.S. still has its ISM services PMI up for release before the end of the week, so another strong read could fuel tightening hopes and and risk-off flows.

If we do see a turnaround in risk-taking later on, keep an eye out for a bounce and possible test of channel resistance at 12,000. We might even see a bullish breakout attempt then!