Market Minute: Has the Tech Rally Run Out Of Steam?

Nasdaq 100 futures (/NQ) are down about -0.7% in early trading, with yesterday’s close of 21,420 marking a roughly +30% rally off the tariff news-related low point on Apr. 7. But now price may be taking a breather at a noteworthy technical level around 21,500 as the broader market struggles to find its footing.

The 21,500 level stands out not because it represents an extreme high or repeated ceiling; but rather because the yearly Volume Profile shows a large node (price area with heavy trading) that lines up with this region. Volume nodes are often used by traders to look for area of potential support/resistance or consolidation, so this could be key area to watch going forward.

For now though, the technicals are mostly holding up for the bulls. Price remains above most major moving averages and remains far above the recent gap to the upside from May 9, which gives the level of 20,288 to watch for potential gap closure. The Relative Strength Index, which measures momentum, is perhaps the first warning sign starting to show as the indicator is backing off from the overbought threshold of 70.

If price breaks beyond the volume node near 21,500, traders could be looking for further potential resistance at the yearly +1 Standard Deviation Channel that is presently near 21,875. To the downside, there’s another volume node near 20,500, which also roughly lines up with the 21-day Exponential Moving Average.