NAS100 flashing overbought signals

Apple revenue warning could be a wake-up call for the markets. The coronavirus should have a temporary impact on the global economy, but the magnitude and length of this impact is still a grey area.

Below is a weekly chart of the Nasdaq 100. The latter looks clearly overbought. It duplicated exactly 100% of the 2016/2018 rally, but in twice less time with a near parabolic move. Back then we had a healthy bull market backed by global synchronized growth. We can hardly say the same today, with a just recovering US manufacturing sector, sluggish growth in Europe and now the second world economy about to take a hit in Q1, potentially longer.

Nasdaq 100 overbought signs:

• Distance from the 200-day moving average is stretched
• Bollinger bandwidth unusually large for a bull move
• Weekly and monthly RSI in overbought zone
• MACD line at record level (distance b/w the 12-week EMA and 26-week EMA)