Nasdaq struggles below $19,660 despite Fed-induced tech stock rally
Nasdaq slips below $19,660 as Fed stance stalls rebound
The Nasdaq Composite Index continues to face downside pressure following its failed rebound attempt on Wednesday.
Price action during the early North American session on Wednesday showed the index rising briefly to $19,660, before falling back to retest the 50% Fibonacci retracement level. This level, which marks the midpoint of the previous rally, has become a critical pivot zone, helping to stabilize the recent pullback.
Highlights
-Nasdaq dropped from $19,660 after failing to break higher on Wednesday
-50% Fibonacci retracement held firm, cushioning the decline
-RSI readings still favor potential bounce if $19,660 is reclaimed
Wednesday’s price action was driven by a combination of technical forces and macro headlines. The Federal Reserve's latest policy statement maintained a hawkish tone, reaffirming expectations for fewer rate cuts in 2024. While some tech stocks reacted positively, lifting briefly on earnings optimism and positioning, the broader Nasdaq index struggled to gain meaningful traction. This suggests broader investor hesitation despite sector-specific strength.
NASDAQ price dynamics (January - June 2025). Source: TradingView
Crucially, the Fed news helped contain the selloff. The 50% Fibonacci level acted as a solid buffer, preventing further losses during the session. This floor has held firm through two separate retests, indicating some level of buyer interest at these technical levels.
Nasdaq faces directional risk as Juneteenth holiday cuts volume
However, broader sentiment appears restrained going into Thursday. The U.S. market is shut for the Juneteenth holiday, and volumes have faded into the pause. This creates a brief window of stasis but leaves the index exposed to directional risk once trading resumes.
From a technical perspective, immediate support lies at the 61.8% Fibonacci retracement level. A break below this would suggest a deeper correction in the short term and signal the end of the current consolidation phase. Conversely, both the 4-hour and daily RSI indicators are holding in bullish territory, implying momentum may favor another upward attempt.
For that to materialize, Nasdaq must first reclaim the $19,660 level and aim for the key resistance at $19,800. That area previously capped bullish moves and will be a major test for trend continuity. If buyers can push through that threshold, it would open the path to revisit the early June highs.
Nasdaq slipped after failing to reclaim the wedge trendline during the rebound. 100 EMA and 61.8% Fib zone offered strong support near $19,370 for a potential recovery.
