The Nasdaq 100 initially dropped on Friday as fears out of the Middle East continue. However, we have seen a bit of buying since the open, and it is trying to stabilize at a significant support area.
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The Nasdaq 100 initially dipped during Friday trading but has turned around to show signs of life. That's actually a pretty encouraging sign because we continue to bump along this support range that starts at 28,500 and extends down to 28,000 or so.
With that being said, it's worth noting that this is a market that is trying to digest a massive amount of gains previously. And the 50-day EMA above continues to offer a significant amount of resistance.
Range-Bound Trading and Macro Drivers Near Key Support
Ultimately, I think what we are seeing here is a market that's trying to sort out what to do next. And it's worth noting that the market will remain very beholden to what's going on in the Middle East and, of course, what's going on with interest rates. Interest rates did drop a bit on Friday, so that's helped the recovery a bit. But overall, I think this is a situation that you have to be very cautious with. We are sitting right at support. Range-bound traders are probably interested in this, and we are in the middle of earnings season, so there's a lot of different things that could come of this.
I don't have any interest in shorting the Nasdaq regardless. I don't care if it does fall from here. But this is a market that will be moving on the AI trade, the next headlines coming out of the Middle East, whatever's happening with the yields in America. There are just so many different things happening at one point that it is worth watching very closely where we are. The reaction so far, though, is fairly bullish.