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NASDAQ Composite Pullback Watch
About 2 weeks ago in the Idea Chamber I mentioned that the NASDAQ Composite had met the minimum requirements for its Bullish Impulse wave pattern when the index hit 7,505.77 in late January.
Well, the index had a tough week after that post with an approximate 10% sell-off. The index did however have a nice reversal on Friday afternoon 2 weeks ago. This Friday brought about another mid-day type reversal. This mid-day reversal looked bearish though, not bullish like the previous week.
Let's see what the pullback and subsequent rebound is indicating on the charts.
NASDAQ Composite - Downside Price Targets
I've previously commented on the pullback for the NASDAQ. I had mentioned that a flatter correction was most likely in the cards for the index rather than a steep pullback and the correction should probably be somewhere in the 10-15% range.
But now that there has been a pullback and subsequent rebound, a Fibonacci Extension Tool can be placed on the chart to calculate potential downside targets with any sort of continued market correction.
The previous downside target of approximate 6,200 I mentioned in the Idea Chamber was based solely on a previous consolidation area during the index's uptrend. However there are now 3 anchor points available to place a Fibonacci Extension Tool on the chart. The…...
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I discuss in detail the price targets calculated by the Fibonacci Extension Tool on the above chart. I review what each of those price targets also represents for the long-term trend.
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