NAS100|The worst is still to come, more selling ahead!
I was just going through the chart and market history and decided to share my thoughts on the current market situation.
We can definitely see that the stock market is tumbling to the floor. But the big question is, where shall this end? Everyone is eager to know the answer so we buy the dip.
The chart above is a weekly chart. NAS100 continues to break the lows as we can clearly see from the past weeks. Today (Monday) NAS100 is trading below the May 2022 low. A daily close below this low will mean that NAS100 will continue further down. Ahead of it is the 200 simple moving average. I have also plotted my Fibonacci retracement tool from point A to B and noticed that- near the 200 SMA is the 61.80 fib level. Should we expect the market to bottom around this level? Only time will tell.
I also took time to study the 2008 financial crisis chart and see what I could possible learn from it.
In 2008, NAS100 tumbled with at least 50% from June 2008 high to November 2008 low. For sure many where watching the 200 SMA and perhaps thought the market would bounce up from there, but as we can see on the chart below the market just went through the line and further it collapsed.
Today, history is definitely repeating itself. We can expect the 200 SMA and 61.80 fib level to be penetrated and 78.60% fib level might be an ideal level to watch this market and that is at around 9000.
Maybe you are wondering. What exactly happened in 2008?
By the winter of 2008, the U.S. economy was in a full-blown recession and, as financial institutions' liquidity struggles continued, stock markets around the world were tumbling the most since the September 11 terrorist attacks.
In January 2008, the Fed cut its benchmark rate by three-quarters of a percentage point—its biggest cut in a quarter-century, as it sought to slow the economic slide.
The bad news continued to pour in from all sides. In February, the British government was forced to nationalize Northern Rock.
In March, global investment bank Bear Stearns, a pillar of Wall Street that dated to 1923, collapsed and was acquired by JPMorgan Chase for pennies on the dollar.
Source: Investopedia
The bottom line?
US inflation accelerated to a fresh 40-year high in May to 8.6%, a sign that price pressures are becoming entrenched in the economy. That will likely push the Federal Reserve to extend an aggressive series of interest-rate hikes and adds to political problems for the White House and Democrats.
With all this on the table, we can expect the worst for the stock market.
I believe the stock market will continue to tumble and picking bottoms at this time is not a wise idea.
If you enjoy reading my ideas please do support with likes.
We can definitely see that the stock market is tumbling to the floor. But the big question is, where shall this end? Everyone is eager to know the answer so we buy the dip.
The chart above is a weekly chart. NAS100 continues to break the lows as we can clearly see from the past weeks. Today (Monday) NAS100 is trading below the May 2022 low. A daily close below this low will mean that NAS100 will continue further down. Ahead of it is the 200 simple moving average. I have also plotted my Fibonacci retracement tool from point A to B and noticed that- near the 200 SMA is the 61.80 fib level. Should we expect the market to bottom around this level? Only time will tell.
I also took time to study the 2008 financial crisis chart and see what I could possible learn from it.
In 2008, NAS100 tumbled with at least 50% from June 2008 high to November 2008 low. For sure many where watching the 200 SMA and perhaps thought the market would bounce up from there, but as we can see on the chart below the market just went through the line and further it collapsed.
Today, history is definitely repeating itself. We can expect the 200 SMA and 61.80 fib level to be penetrated and 78.60% fib level might be an ideal level to watch this market and that is at around 9000.
Maybe you are wondering. What exactly happened in 2008?
By the winter of 2008, the U.S. economy was in a full-blown recession and, as financial institutions' liquidity struggles continued, stock markets around the world were tumbling the most since the September 11 terrorist attacks.
In January 2008, the Fed cut its benchmark rate by three-quarters of a percentage point—its biggest cut in a quarter-century, as it sought to slow the economic slide.
The bad news continued to pour in from all sides. In February, the British government was forced to nationalize Northern Rock.
In March, global investment bank Bear Stearns, a pillar of Wall Street that dated to 1923, collapsed and was acquired by JPMorgan Chase for pennies on the dollar.
Source: Investopedia
The bottom line?
US inflation accelerated to a fresh 40-year high in May to 8.6%, a sign that price pressures are becoming entrenched in the economy. That will likely push the Federal Reserve to extend an aggressive series of interest-rate hikes and adds to political problems for the White House and Democrats.
With all this on the table, we can expect the worst for the stock market.
I believe the stock market will continue to tumble and picking bottoms at this time is not a wise idea.
If you enjoy reading my ideas please do support with likes.
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