Nasdaq Composite: Bond Yield Panic
IXIC has been dropping quickly due to rising bond yield e.g. US10Y and US30Y and rising volatility. Volatility is often a self-fulfilling prophecy, as many funds automatically sell when volatility rises above certain threshold, creating more volatility and causing other investors to sell.
However, the big picture remains bullish because the overall market sentiment is not panicking about recession. Also, newbie individual investors have not crowded the stock market like they did in 2020 and 2021. The Fed may start rate cutting in 2024, which will probably ignite another huge stock rally.
Therefore, IXIC may drop to 13150, the 0.5 fibonacci retracement of the 2022 downturn. Then IXIC will probably recover and retest the previous high in early September. September and October are often bad months for stocks, but the first two weeks of September might be bullish just because August has been too bearish.
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