Nasdaq 100 Remains Neutral After the Fed's Decision

The NAS100 initially dropped nearly 0.6% as the Federal Reserve's official decision was announced. However, so far, the event has not been decisive on the daily chart to establish a clear direction. The central bank chose to keep interest rates at 4.5%, as expected, and in its official statement, it acknowledged that inflation remains somewhat elevated and is still far from the 2% target. As long as this rate pause outlook continues, a sustained high level of 4.5% could continue to hinder overall economic activity and may become a key factor in the bearish bias that emerged in December.

Short-Term Sideways Channel:
At the moment, the market remains within a well-defined sideways range, with a ceiling at 22,000 points and a floor at 21,000 points. The price continues to fluctuate within this range, reflecting a clear lack of trend in recent movements. For now, this range stands as the most significant technical formation, potentially serving as a precursor to a much larger trending move.


Neutrality in Indicators:

• The RSI line remains near the neutral 50 level, indicating that there is currently a perfect balance between buying and selling forces in the market.
  
  
• The MACD histogram closely resembles the RSI, oscillating near the 0-neutral line, which suggests that the moving averages do not show a clear short-term trend bias.
  
  The neutral stance of both indicators suggests that the Nasdaq may continue moving sideways for now, aligning with the current range-bound market behavior.
  
  

Key Levels:

• 22K – The most important resistance, aligning with the top of the sideways channel. A breakout above this level could be decisive, signaling new all-time highs and reviving the long-term bullish trend.
  
  
• 21K – A crucial short-term support level, coinciding with the 100-period moving average. Price action near this level could intensify selling pressure, potentially leading to more significant bearish moves.
  
  
• 20K – The ultimate support level currently holding the structure. A drop to this level could tilt the balance towards the formation of a fresh downtrend in the short term.
  
  

By Julian Pineda, CFA - Market Analyst