Nasdaq 100 Analysis: Tech Rally Slows, But Is the Bullish Trend Intact?

Summary:
• Nasdaq 100 analysis: The tech rally slows as the index faces resistance near 21,534.27. What's next for NDX in 2025.

The Nasdaq 100 (NDX) has faced some turbulence recently as the previously strong tech rally begins to slow. Following a recent peak close to 22,138.33, the index saw a significant decline, locating initial support at the 20-day EMA around 21,331.33. Despite the prevailing optimistic trend, the latest fluctuations have raised doubts about the continuation of the rally or the possibility of a more substantial correction looming.

Key Levels to Watch

1. Resistance at 21,534.27: The index failed to hold above this level during the recent sell-off, making it a critical resistance point in the short term. A break above this level could reignite bullish momentum.
2. Support at 20,581.71: The 50-day EMA converges around this zone, offering strong dynamic support. A sustained close below this level could signal the start of a deeper correction toward 19,896.33.

Broader Market Context

The Nasdaq 100’s strong performance this year reflects growing confidence in the tech sector, with advancements in innovation driving significant investor interest.

Yet, as the year comes to a close, market dynamics are changing. Worries about possible changes in Federal Reserve policy and a surge of profit-taking, as investors secure their profits, might increase pressure, leading to a more wary attitude in the concluding trading sessions of 2024.

What Comes Next?

As the Nasdaq 100 steadies, investors should assess whether the index can reclaim 21,534.27 and sustain its upward movement. If it fails to do so, the focus may shift to a retest of the 50-day EMA or possibly deeper declines. Due to reduced holiday trading volumes, volatility may surge, highlighting this as an essential time for positioning for 2025.