Market sell-off continued on Tuesday, with NQ spotting a familiar intraday pattern, morning sell-off that was followed by lunch rally then afternoon selloff going into the close.
The declining momentum seems to have slowed down on Tuesday, and there are 2 possible reasons for that:
1. It may be slowing down before a snap-back rally going into the weekend, or,
2. A running correction, an indication the market is setting up for a massive selloff once running correctionhas ended.
Key support level for NQ on Wednesday will be 3800.
-- Staying above 3800 implies either a potential rally but NQ needs to trade above 3850 to potentially trigger a short-covering rally. Inability to break and stay above 3850 implies choppy sideways pattern.
-- Breaking below 3800 implies the slowing down of momentum is a running correction. If so, it would be followed by a liquidation decline, next support is 3730 and 370.
