The Nasdaq-100 is heading down lately after a decent 2023 rally that seemed to fade as the summer turned into fall. This index, heavy with the tech stocks most mentioned in the financial media, is having a tough week just as a prominent Silicon Valley billionaire issued a “techno optimism” article that he called a “manifesto.”
Marc Andreesen’s venture capital firm, Andreesen Horowitz, is heavily invested in tech (mostly start-ups) and it’s certainly coincidental that his apparent public relations puff piece comes at a time when there’s recent steady selling of publicly traded stocks in the sector.
While everyone always enjoys reading a wordy billionaire-composed manifesto now and then, those unloading the leading components of the Nasdaq-100 do not seem all that techno-optimistic right now as anyone who can discern the meaning of a price chart can see.
Tech Stocks Price Charts.
The daily price chart for the NASDAQ 100 now looks like this:
The index topped in mid-July up above 15800 and now goes for 14127, a 10 1/2% drop from the peak to the present.
Less than optimistic investors have taken it below the late September support level and the 50-day moving average (the blue line) has turned downward. It looks like the index will test the 200-day moving average (the red line).
Here’s the daily price chart for one of the largest stocks in the Nasdaq 100, Alphabet (formerly Google):
The big selling hit this week as earnings came in at less than Wall Street analysts expectations. You can see how the stock fell below the red dotted line that represents the former support levels from the August and September lows.
Alphabet is filling that red-circled gap up that took place in July when analysts were happier with earnings and revenues. It may now test the up trending 200-day moving average and maybe test the older gap up from May.
Here’s the daily chart for another of the largest Nasdaq 100 components, Meta Platforms:
After a spectacular run up from March to late July, the stock is dropping on decent volume this week. Now below its 50-day moving average, it may test those August support levels.
Note the obvious double top with the negative divergence between the relative strength indicator (RSI, below the price chart) and the direction of price from mid-July to October. The Alphabet chart also shows an old gap up: the late April red circle may be a target.
Another of the very big Nasdaq 100 components, Comcast
CMCSA
The March to August up trend is awesome to behold but it’s over with. Sellers have taken over in a big way with a huge price gap down. The stock now trades below its earlier-in-the-month price low.
But wait, there’s more: it’s below the down trending 50-day moving average now and dropped to below the up trending 200-day moving average. A lot of investors just wanted out and quickly.
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