Insights 
VT 
The NASDAQ index reached a new intraday peak of 22,000.97 but retracted to trade near the previous levels. The index’s highest gain was +121.48 points before settling around 21,880.51, marking an increase of just 1.13 points (0.01%).
The 22,000 mark now acts as a potential focus for traders, serving as a point to sell against with minimal risk if tight stops are placed above. A drop below this point could indicate a shift towards a more bearish trend.
Technical Analysis
On the hourly chart, previous peaks from August 13 create a ceiling between 21,742 and 21,803. Falling below this range would likely embolden sellers and disappoint those looking for new highs. The focus then moves to the ascending 100-hour moving average at 21,541.67 and subsequently, the 200-hour moving average at 21,434.86.
Previously, declines below the 200-hour moving average in August and early September quickly reversed, limiting downward movement. For a sustained downtrend to establish, the index must break and maintain below both the 100-hour and 200-hour moving averages, potentially allowing for a longer correction.
We are seeing the NASDAQ showing signs of exhaustion after tapping the 22,000 level and immediately reversing. This price rejection is significant, especially as it coincides with this morning’s August Consumer Price Index data, which came in slightly higher than expected at 3.6%. That inflation reading dampens hopes for a near-term interest rate cut and gives us a reason to be cautious at these new highs.
Given this setup, we should consider protective strategies. Buying put options with strike prices below 21,800 offers a clear way to bet on a downturn, with risk limited to the premium paid. The CBOE Volatility Index (VIX) has also ticked up over 12% to 15.5 today, suggesting that demand for portfolio insurance is rising.
Market Outlook
The first critical test for sellers will be pushing the index back below the 21,742 to 21,803 zone, which was the ceiling back in August 2025. A failure to hold above this area would confirm that today’s new high was a “false breakout.” This would give us more confidence to add to bearish positions.
Looking back at August and early September 2025, every dip toward the major moving averages was aggressively bought by the market. However, with inflation proving sticky, we may not see the same resilience this time. A break below the 100-hour moving average at 21,541 would be the first sign that this pullback is different.
We saw a similar pattern of market behavior in late 2021 before the sharp rate-hike cycle began, where new highs were met with fading momentum as monetary policy concerns grew. For the current downside move to gain serious momentum, we need to see a sustained break below the 200-hour moving average at 21,434. Such a move would suggest a deeper correction is underway, making longer-dated puts for October 2025 an attractive option.
