updated: Nov 30, 2021

NDX has been on correction watch for over three months, ever since its 200-DMA caught up with the bottom of its never-ending rising white channel.

Does its recent 4.6% slump offer any hints as to what’s next?

continued for members…

Having dropped through its SMA10 and SMA20, the nearest support for NDX is the white channel midline, currently lying on top of its SMA50 at 15,585. Dropping to that support would represent a 7% decline, while a drop to the 3.618 Fib would mean a 8.4% slide.

A 10% decline would mean a drop all the way to 15,088, which is not really near anything other than the white channel’s .236 line.

But, this index doesn’t usually make sense. Random minor drops without any follow-through are scattered across its charts. Since it’s about to experience a bearish 10/20 cross, we’ll keep an eye on the 3.618 at 15,343. If it doesn’t hold, then we can start to worry about the .886 at 14,656.

The big picture:It shot above its white 3.618 without a decent backtest. If it doesn’t correct soon, the rising white channel will soon reach its purple 3.618 at 17,498.