Why Is the Nasdaq 100 Staying Resilient?

The Nasdaq 100 is consolidating after recent volatility, with price holding above important technical levels.

The main tension for markets is clear: higher interest rates are putting pressure on growth stocks, while hopes for improved US-China relations are helping sentiment.

For now, the index has managed to hold its ground as traders wait for clearer signals from both the Federal Reserve and the upcoming US-China summit.

Hawkish Fed Keeps Pressure on Tech Stocks

The Federal Reserve raised its benchmark interest rate by 25 basis points on September 16, taking the target range to 3.75%-4.00%. It was the Fed's first rate increase since 2023.

The updated projections also point to the possibility of another rate hike in 2026. That keeps financial conditions relatively tight and can weigh on growth-focused stocks such as those heavily represented in the Nasdaq 100.

However, the index has remained relatively firm. This suggests that investors are still willing to hold technology stocks despite the higher-rate environment.

US-China Talks Keep Investors Focused

US and Chinese officials are holding economic and trade discussions ahead of the September 24 Trump-Xi summit in Washington. Talks include trade, investment, and artificial intelligence (AI), while both sides are also discussing the future of their existing trade truce.

After a long talks with the Chinese team, US Treasury Secretary Scott Bessent, said,

"The US has proposed that we have a notification mechanism between the two countries."

Kurt Campbell, US deputy secretary of state, said,

"I think you will hear the president announce the intention to meet with Xi Jinping two more times.”

Any progress could improve market sentiment, particularly around technology and other sectors exposed to global trade.

At the same time, traders should be prepared for volatility if the talks fail to produce the progress markets are expecting.

Nasdaq 100 Rebalance Brings Large Passive Flows

The Nasdaq 100's quarterly rebalance took effect on September 21, with SpaceX's weighting rising from about 1.28% to 2.82%. Bloomberg confirmed the 2.82% weighting ahead of the rebalance.

Market estimates suggest the change could create roughly $15.5 billion to $22 billion in passive buying for SpaceX from funds tracking the index.

This is an important technical factor for the index because large rebalancing flows can temporarily affect individual stocks and overall index positioning.

Nasdaq 100 Technical Outlook

The broader trend remains constructive, with the index trading above several important moving averages. The Nasdaq 100 gained 1.73% on September 17 to close at 29,446.98, reclaiming the 20-day, 50-day, and 100-day moving averages.

Based on the current technical levels:

Resistance: 29,495 and 30,000

Support: 29,180-29,280 and 28,900

The 29,180-29,280 zone is particularly important because several moving averages are clustered in this area. Holding above this zone would keep the current bullish structure intact.

What Should Traders Do Now?

• Upside Scenario:

A sustained move above 29,495 would strengthen the short-term bullish setup. If positive developments emerge from the US-China talks and concerns about further Fed tightening ease, the Nasdaq 100 could move toward the 30,000 psychological level. A stronger breakout could bring the August high near 30,200 back into focus.

• Downside Scenario

If the index falls below the 29,180-29,280 support zone, the recent recovery could weaken. The next important level would be around 28,900. A deeper break below that area could expose the 28,000 region.

• Key Economic Data to Watch

Traders should also monitor the S&P Global Flash US Manufacturing and Services PMI releases on September 23. These reports can provide fresh information about business activity, inflation pressures, and the health of the US economy.

Stronger-than-expected data could reinforce expectations for tighter monetary policy, while weaker data could increase pressure on the Fed to slow its tightening path.