On Thursday, February 27, 2025, the Nasdaq Composite fell 2.8%, closing at 18,544.42. This decline was primarily driven by a significant drop in technology stocks, notably Nvidia, which plunged 8.5%, despite reporting strong earnings and an optimistic outlook.
The broader market also experienced downturns, with the S&P 500 losing 1.6% to end at 5,861.57, and the Dow Jones Industrial Average decreasing by 0.4% to 43,239.50.
Fresh Tariff Announcements Rattle Investor Confidence
Investor sentiment was further dampened by President Donald Trump’s announcement of new tariffs on imports from Canada, Mexico, and China. The President stated that tariffs on Mexico and Canada would take effect on Tuesday, while existing tariffs on China would double from 10% to 20%.
These actions have reignited concerns about global trade tensions, particularly affecting sectors reliant on international supply chains, such as technology.
Source: AP
Tech Valuations Face Investor Scepticism Amid Market Volatility
Analysts caution that elevated valuations in the tech sector may lead to continued volatility. Investors are advised to closely monitor the impacts of trade policies and upcoming corporate earnings reports in the coming weeks.
With major indices reacting to trade policies and earnings reports, traders now turn their focus to key technical levels and price action for the next move.
NASDAQ Futures Slide to Yearly Lows as NVIDIA’s Gains Fade
Nasdaq futures briefly caught a tailwind from NVIDIA’s strong earnings after hours on Wednesday, but the optimism didn’t last. After an initial push higher, the market reversed sharply, breaking through key support levels and sinking to new yearly lows.
Asian & European Sessions: Weak Momentum
The Asian session held within Wednesday’s value area, dipping below the low before recovering. Europe saw a brief attempt to push above 21,300, but enthusiasm quickly faded. A run at 21,400 stalled, leaving the market waiting for New York to decide its next move.
U.S. Open: Sellers Take Over
By the time New York opened, the tone had shifted, with headline risk dominating the market narrative. Nasdaq broke below Wednesday’s value area, made a brief attempt to stabilise near February’s value area low, but ultimately lost ground. Selling pressure accelerated, driving the index down to 20,583, its lowest level of the year.
With February closing out, the Nasdaq is now firmly planted inside Q4 2024’s value area, which could offer some stability and attract longer-term investors. However, 20,600–21,000 remains a key battleground. While this zone suggests potential buying interest, ongoing headline risks may keep investors on the sidelines, waiting to see if the market tests the 20,000s — a level that coincides with the Q4 value area low. If that happens, it could serve as a more decisive point for longer-term accumulation.
Key Levels to Watch
- Support: 20,400 (historical level), 20,000 (Q3 2024 value area low)
- Resistance: 20,800 – 21,000
If sellers stay in control, 20,400 is the next area to watch. A break below could see the market drift toward the low 20,000s, aligning with the Q4 2024 value area low.
