US closed mixed overnight, but notable decline was seen in NASDAQ. The selloff came after Treasury Secretary, former Fed chair, Janet Yellen said that “it may be that interest rates will have to rise somewhat to make sure that our economy doesn’t overheat, even though the additional spending is relatively small relative to the size of the economy”.
Nevertheless, later in the day, she clarified that she was neither predicting nor recommending a rate hike. “If anybody appreciates the independence of the Fed, I think that person is me,” she said. “I don’t think there’s going to be an inflationary problem. But if there is the Fed will be counted on to address them.”
NASDAQ’s strong break of 13698.66 support should confirm rejection by 14175.11. The index should now be in the third leg of the consolidation pattern from 14175.11. Deeper fall is likely back towards 12397.05 support for the near term. Still, there is no risk to the medium term up trend yet, as long as 12397.05 holds.
