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A big technical test this week could determine Big Tech’s fate
This week could make or break the tech trade. BTIG chief market technician Jonathan Krinsky pointed out the Invesco QQQ Trust ETF is sitting just above its 200-day moving average. The QQQ tracks the Nasdaq-100 index, which is made up of the 100 largest stocks in the Nasdaq Composite, including Nvidia and Apple. The 200-day moving average is used by traders and chart analysts to gauge an asset’s long-term trend. If a stock, for example, breaks below it, it could signal trouble ahead. “QQQs Looking Like Another 200 DMA Test,” Krinsky wrote. “If we see any weakness early [this] week, look for a test and reclaim of the 200 DMA on QQQs as a sign of a tactical low.” So far, the fund appears to be passing the test. The QQQ traded around $452 per share in the premarket Monday, while the 200-day moving average sat at $441.67. The fund dipped below the 200-day average on Aug. 5 but recovered to close above it. The Big Tech ETF hadn’t closed below its 200-day moving average since March 10, 2023. This technical test comes on the back of a tough week on Wall Street, as new jobs data and manufacturing reports reignited worries over the state of the economy. The QQQ fell 5.8%, marking its biggest weekly drop since November 2022. Investors will get more data this week that could move markets, with the consumer and producer price indexes on deck. Elsewhere on Wall Street this week , Morgan Stanley downgraded Church & Dwight to equal weight from overweight. “From a company perspective, we are very forthright that there are no home runs in our coverage here from our vantage point,” analyst Dara Mohsenian said. “We remain most bullish on OW rated Coca-Cola and Colgate as our top picks longer-term and see short-term upside at EW rated Clorox and Keurig Dr Pepper, despite our longer-term EW stances.”
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