Nasdaq Composite: Expanded consolidation in the making

(News Bulletin 247) – The futures on indices with the approach of the opening of Wall Street, for only half a session, let glimpse of the red a little less bright than in Europe and in Asia. The reaction of mistrust of the trading rooms in the face of the discovery of a new “variant” of the coronavirus with Covid-19 nevertheless sows confusion. According to the scientists behind this discovery, it has the potential to spread very quickly. It tends to quickly replace other variants. It is also not known at this stage whether the vaccines currently available maintain their effectiveness.

More generally concerning the reaction of the markets to the development of the epidemic, a resurgence of mistrust was already to be noted since the heart of the month of numbers. “The fears surrounding a new wave of Covid are spreading in the markets in an orderly manner and selective ”, according to the Lyxor Cross Asset Research teams. “In the United States as in Europe, the differentiation between titles has increased according to their sensitivity to trends linked to the pandemic. Thus, the values ​​favored by mobility restrictions have outperformed those of entertainment, consumer services or consumer discretionary “.

If the feeling of fear were to occasionally turn into fear in December, there would no longer be any question of differentiation.

In the immediate future, the markets will follow, with a wet finger, the first conclusions of scientists on the contagiousness of this variant and its degree of resistance to current vaccines.

No statistics are on the agenda this Friday, deserted by a very large fringe of investors in the heart of the very big Thanksgiving weekend. On Wednesday, the Nasdaq Composite index closed slightly up 0.44% at 15,845 points, after a round of relatively good economic statistics indicators.

KEY GRAPHIC ELEMENTS

Regarding the substantive technical framework, at this stage unchanged:

Since October 28 and the registration of new historic highs after those of September 07, the flagship index of technology stocks of the American stock market has systematically closed on the high points of the session, in strong volumes, which contracted only very little . The buying side, fully mobilized, does not raise any questions.

A court terme:

The entry into a phase of digestion, the structure of which will be instructive for the future, should be considered. We are still in the process of defining the framework, and the amplitude, of future consolidation. Wider consolidation is looming. A first bearish acceleration within this consolidation is possible over this weekend and the start of the next.

Negative opinion on the scale of the coming session.

PREVISION

In view of the key graphical factors that we have mentioned, our opinion is negative on the Nasdaq Composite index in the short term.

This bearish scenario is valid as long as the Nasdaq Composite Index quotes below resistance at 16212.00 points.

DAILY DATA CHART

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