Red lines - bullish channel
Blue lines- Fibonacci retracement levels
In previous posts we warned traders of a possible pull back in NASDAQ towards 14,750. The index made a low around 14,500 and bounced higher to form a lower high. Price is now breaking out of the red upward sloping bullish channel. This is a new sign of weakness. NASDAQ justifies a deeper correction at least towards the 38% Fibonacci retracement around 13.930. As long as we trade below the recent high of 15,630, NASDAQ will be vulnerable to a move lower. We continue to believe that at current levels we prefer to be neutral if not bearish.