![\"nasdaq](\"http:\/\/www.laidtrades.com\/wp-content\/uploads\/2010\/07\/070110nasdaq.png\")
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Good day to you people! It is sad to say that I got some bad news to deliver to you. The Nasdaq composite is an stock market index in the US that has over 3,000 listed technology and growth companies. This composite, though, is not exclusively a US index since non-US companies are listed here as well. In any case, this composite is one of the three major indices, alongside the DJIA and the S&P 500, that are highly followed by investors. Yesterday, however, the index plunged with a 1.21% loss, breaking the neckline of a head and shoulders formation in the process. The weak actually started off on a sour note as it opened with a bearish gap and was followed by two consecutive days of heavy losses. If the index is not able to creep back above the neckline, it would more likely drop further until it reaches its downside target at around 1,750.00. This scenario would actually place the index back on a bear market again. A couple of indicators suggest that this could happen. the first one is the MACD which already turned negative. The other one is the RSI which is now showing that the index is gaining some downside momentum. On the bright side, if risk aversion disappears and the buying resumes, the index could bounce back until it meets some resistance somewhere at 2,300.00.<\/p>\n
Monday\u2019s gap down was due to the poor results of China\u2019s leading economic indicators. One of China\u2019s leading barometers failed to get some fans when it only showed a gain of 0.3% after rising by 1.7% the other month. Yesterday\u2019s drop, on the other hand, was due to the weak US ADP report which only showed that US firms had added 13,000 new workers as against the 61,000 expected. This weaker-than-expected result, now, could also reflect on the US government\u2019s actual figure which will be reported this Friday. A less-than-stellar count in the NFP employment change would more likely hit the markets hard. Equities alongside\u00a0 the non-dollar currencies like the AUD, NZD, CAD, EUR, GBP would further lose their appeal versus the safer ones like bonds, USD and JPY.<\/p>\n
Meanwhile, the expected 7.4% slide in the US\u2019s pending home sales, which is due for release today at 2:00 pm GMT could likewise place some selling pressure on equities and the major non-dollar currencies as well.<\/p>\n