NASDAQ 100 - Is the worst yet to come? Probably.

21 mar 2020

With lockdowns spreading around the world almost a quickly as the virus, the new reality is a severe recession. Seeing China start to theoretically emerge from a state of emergency gives us hope. But I say theoretically because the expulsion of foreign journalists suggests the Chinese government has something to hide.

We have now entered phase 2 of the crash which sees an imminent break of the 4-year support line at NDX 6723 points. Potentially a further break down towards the 10-year support at 5,700 points.
At below 6,000 points, I would see deep value with 10 years of gains being knocked off the market capitalization. That deep value zone stretches a long way down to 4000 points which is below the year 2000 dotcom highs.

Realistic expert estimates suggest our social lifestyle and working practices will be impacted at least through to autumn or even the end of the year.
Government commitment to support our economies are admirable, and we should expect to see a mass devaluing of currencies as more paper is printed.

Here’s hoping that humanity’s response and the response of our pharmaceutical industries are so strong we bounce back quickly.
But we must be realistic.

During this crisis, we are seeing the best and worst of humanity. The best being the bravery of our health care professionals and the acts of kindness we bestow on each other. The worst being people panic buying facemasks and stealing sanitizer from hospitals, depriving our doctors and nurses of critical products.

Some people are even people selling toilet roll and facemasks on eBay for extortionate amounts which is disgusting.

Stay safe everyone.

Barry