The global lockdown and accommodative central bank policy was always going to benefit the major tech companies but the question was always, how much? The sector is still under increasing regulatory pressure and the ongoing impact of the global shortage of chips on many top companies in the index, but it has not had everything they want.
Gilead and Amazon are the top two companies that have yet to announce earnings numbers. Both companies will release these figures after today's close.
US TECH 100 - KEY TECHNICAL LEVELS
The weekly chart shows the continued dominance of long-term bull trends since the March 2020 low. Price action is now expected to test the 76.4% Fibonacci extension (measured from the 2020 low to September 2020 high at 15,163).
US Tech 100 Weekly Chart
The daily chart shows the ascending channel, where price action has traded higher for the past two and a quarter months. We also saw an increase in channel support due to the emergence what appears to be bullish engulfing candles - giving bulls the opportunity to re-enter the trend.
A bullish continuation after the pre-FOMC drop would bring the 15,163 level into focus with nothing standing in its way until the 100% Fib extension way up at 16,550.
Should we experience selling from current levels, the most immediate level of support would come in the form of the lower bound of the channel, followed by the recent low of 14,780 and the prior low of 14,450 thereafter.