Nasdaq 100 soars despite a rise in yields, VIX Falls. despite the increase in Treasury yields, it reaches its best level since early Feb.

Nasdaq rises on the belief that the worst of the banking sector problem is over.

Despite a sharp increase in U.S. Treasury rates, the index increased 1.42% to 12,741. In a risk-on environment before the FOMC decision. Equity market gains were widespread in the tech sector. The VIX, Wall Street‘s fear measure, sank more than 11 percent and experienced its worst 2-day decline since 2022.

Rumors that coordinated government efforts to support the banking system.  Such as emergency central bank lending and the U.S. Treasury Department’s commitment to protecting smaller lenders. It has ended the worst of the recent banking sector turmoil.

Nasdaq and other stock indices need more Fed convincing

The Federal Reserve must persuade investors that it will take the required steps to stop the spread of systemic risks. Even if that means temporarily shifting its focus away from its battle against inflation, If, ordering for bullish price action to continue.

Nevertheless, when the Fed announces its March decision and publishes a report of economic projections on Wed. We will know more about the policy outlook.

The US Fed tone will set the trend for Nasdaq, S&P, and Dow Jones

Policymakers are anticipated to increase interest rates by a quarter of a percentage point to 4.75%–5.00 percent. Though some Wall Street experts anticipate no change in borrowing costs in light of recent events involving US banks. Regardless of tomorrow’s FOMC ruling, the market voice may be more influenced by advice and comments on financial safety.

Technical perspective

By concentrating on technical analysis, we can see that the Nasdaq 100 is presently testing a crucial resistance area near the 12,900 mark. Where the tops from Jan coincide, with the 38.2% Fibonacci retracement of the Nov 2021/Oct 2022 decline.

Bullish momentum might pick up speed if this region is broken on the topside, opening the door for a move toward 13,700. On the other hand, initial support is located at 12,330. If the tech index is rejected from current levels and starts falling. The 50- and 200-day simple moving averages are used below that level.

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