Tech index facing must hold support test!

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by Kimble Charting

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This chart looks at the Nasdaq Composite Index over the past 22-years on a monthly basis. The chart highlights that the index has spent the majority of the past 18-years inside of rising channel (1).

The rally off the 2009 lows hit the top of the channel a couple of months ago at (2), where it looks to have created a bearish hanging man pattern as it kissed the underside of the rising channel. It hit resistance as momentum is the highest level since the dot.com highs in 2000.

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Selling pressure over the past 6-weeks has this important tech index testing 9-year rising support this month as momentum looks to be moving lower after creating lower highs.

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The long-term trend for this index remains up for the Nasdaq composite index, as it faces one of its most important support tests in the past 9-years at (3). If dual support would not hold at (3), look for selling pressure to ramp up!

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