Technical overbought situation leaves target at 14000 – Commerzbank

The Nasdaq Composite Index currently comprises 2,667 stocks listed on Nasdaq. After the very marked gains in large US companies and the strong start to the year 2021, the market has now seen the first profit taking. According to analysts at Commerzbank, it may take some time to eliminate the overbought situation in the medium term.

Key statements:

From a technical medium-term perspective, the index – led by the ‘winners of the covid crisis’, for example, the e-commerce and remote work sectors – had entered a new technical bull market move. In this, we saw for the first time a recovery in “V”, which from May 2020 directly gave way to rises to new all-time highs. Only in September 2020 did the upward momentum slow. “

“From a short-term technical perspective, a new uptrend was established from the intermediate low at 10831 points in November 2020.”

“This uptrend brought the Nasdaq Composite, without a noticeable consolidation pause, to new all-time highs at 13729 points on January 25, 2021. Since then, the Nasdaq Composite has been losing near-term bullish momentum. It has recently slid below the 10-day moving average with a take profit signal, so it is testing the uptrend since November 2020. “

“The elimination of the technical overbought situation in the medium term should have started. A trading market below all-time highs at 13,729 should come as no surprise. Given that compared to 2021 the Nasdaq Composite Index should have difficulties to return to the strong bullish momentum (in 2019: + 35%; in 2020: + 44%), We are currently maintaining our technical target price (from Q4 2020). of 14,000 points by 2021”.