Nasdaq 100 gains almost 2% after sharp swings tied to AI supply chain concerns

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Nasdaq 100 rises 1.76% today

Highlights

The Nasdaq 100 experienced sharp volatility due to AI supply chain concerns and higher financing costs impacting technology stocks.
Recent weakness in semiconductor and AI shares led to a decline and a reassessment of crucial support levels.
The index trades below key moving averages with technical indicators showing mixed signals and oversold conditions, expected to range from 28,944 to 30,454 over the next five days.

AI supply chain risks and credit costs temper futures recovery

The Nasdaq 100 has recently experienced sharp swings, primarily driven by concerns over AI supply chains and the impact of higher financing costs on technology companies. Last week's marked weakness in semiconductor and AI-related shares contributed to the broader downturn and prompted a reassessment of key support levels. Futures rebounded early in the week, but ongoing concerns around AI credit risks and anticipation of major technology earnings announcements have tempered gains.

Anton Kharitonov, expert at Traders Union, focuses on the technical and sentiment weaknesses in the Nasdaq 100. He sees the rebound as fragile, with the index still capped below its 20- and 50-day moving averages. Persistent selling pressure dominates, as proven by lackluster momentum signals and oversold technicals. He believes that recent turbulence around AI and supply chain news exposes systemic fragility, not opportunity. "Without a convincing push above 29,868, I remain skeptical about the sustainability of any upside," says Kharitonov.

Viktoras Karapetjanc, expert at Traders Union, notes that the index advanced sharply and still holds above its 200-day support, reflecting resilience. He highlights that uncertainty around AI financing and upcoming tech results is already absorbed in prices. Karapetjanc believes the bullish structure is intact and the market will likely consolidate before resuming growth. "I see the consolidation phase as a springboard for further upside — the market continues to offer setups for forward-looking investors," he says.

Sholanke Dele, market strategist, views recent Nasdaq 100 swings as a sign of underlying market nerves. He notes that unresolved AI supply chain issues and credit risks weigh heavily on sentiment. Upcoming tech earnings remain a potential volatility trigger. "The probability of a sustained pullback remains high until downside risks are fully priced in," observes Dele.

Long-term bullish bias muted by oversold signals and mixed momentum

The index is trading below its 20-day ($30,525) and 50-day ($29,868) moving averages but remains above the 200-day ($27,738), indicating a long-term bullish bias overshadowed by short- and medium-term selling pressure. Immediate resistance stands at $29,868, while near-term support aligns with the session high of $29,609 based on intraday action. Momentum signals are mixed; MACD and ADX are neutral, the RSI sits at 35.16 with a 'Sell' forecast, and both the Stochastic RSI and CCI reflect oversold conditions. BBP at -452.76 highlights an intraday oversold setup, while the Awesome Oscillator remains neutral. Although the index saw a 1.76% gain to close near the day's high following an upside gap, overall momentum signals are cautionary.

Earlier, analysts noted that the Nasdaq 100 was facing persistent downside risk and technical weakness, with mixed momentum signals cautioning against a clear directional move. The latest analysis adds nuance by highlighting an intraday oversold setup and neutral momentum readings, suggesting traders should closely monitor $29,868 as the key resistance for any potential bullish breakout in the coming week.

Source of Data: NDX Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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