Is the Nasdaq sell-off just beginning?

Technical analysts are warning investors against rushing to buy recent falls in technology stocks. After breaking below its key 50-day moving average, the Nasdaq Composite is signalling that this correction could be deeper and longer-lasting than previous short-term pullbacks. Breaks below that average have previously offered buying opportunities, but the chart setup now looks different. A lack of a clear buying response at local support and increasing selling pressure suggest the market may not yet have reached a local low, making dip-buying particularly risky.

Technical indicators, including the position of the lower 200-day moving average, point to scope for further institutional profit-taking. The backdrop also includes growing impatience over the returns from heavy AI infrastructure spending and persistently high government bond yields. Until momentum indicators suggest selling pressure is exhausted and a stable base forms, attempts to buy at apparently attractive prices risk deeper losses as selling spreads from semiconductors into software and growth stocks.

Nasdaq market chart, 19 October 2026

Source: CMC Markets, 19 October 2026

This could illustrate how an emotional habit can undermine retail investors. Four years of rising markets have reinforced the 'buy the dip' pattern: each modest pullback has quickly attracted demand and led to new highs. However, no market pattern lasts indefinitely. Trying to catch falling prices without confirmation from market structure can expose an account to substantial losses.

Three issues matter when assessing the chart and liquidity. First, a moving average is a sentiment indicator, not a magic boundary. A break below the 50-day average signals that recent average entry prices are no longer profitable. If the market cannot recover quickly, late buyers may become fearful and stop-loss orders can amplify selling.

Second, the 200-day moving average helps identify the average entry level of longer-term capital. Major investors may wait for that area, alongside established historical support, before accumulating again. Buying between support levels remains speculative without evidence of a statistical advantage.

Third, investors should be wary of the psychology of a bargain. A share that has fallen 15% can fall another 20% if selling pressure outweighs impatient demand. Waiting for selling to subside, a clear buying response and a trade with controlled risk may be more prudent than guessing the bottom. Discipline matters more than forcing a dip-buying opportunity.

European and US session review

European markets began and ended the week with gains, although negative signals from bonds and rising yields remain concerning. Friday's session was upbeat: major indices rose between 0.28% for the CAC 40 and 0.95% for the DAX.

Wall Street presented a different picture as investors faced capital rotation. AI-related companies remain highly valued, but concerns over excessive valuations have grown. The Dow Jones fell 0.34%, the S&P 500 lost 1.09% and the Nasdaq declined 2.14%.

Asian markets continue to search for direction

Asian equities have struggled to find direction over recent weeks. Today's session is somewhat firmer, following a rebound in Wall Street futures. Investors remain focused on Middle East instability restricting oil supplies and rising bond yields. The Nikkei 225 is down 0.7%, Australia's S&P/ASX 200 is up 0.4% and South Korea's Kospi has gained 0.8%. Elsewhere, Hong Kong is up 0.5%, Shanghai is down 0.03%, the Sensex is down 0.4% and Singapore has gained 0.07%.

Warsaw market review

After a week of changing sentiment, Friday brought a new record for the WIG20. Consolidation above 4,200 points could give buyers an opportunity to reach further highs. October began with global equity declines and there are signs that the rally is tiring. Poland's uptrend, which began in July, appears intact for now, although the possibility of a correction remains.

Fear is not yet evident, but European indices are showing uncertainty. Global risk markets remain dynamic and tense. In the short term, rapidly rising bond yields may be a more immediate problem for Wall Street than the prospect of policy-rate increases. The US Treasury has halved the scale of its bond buybacks, according to the source analysis. Together with faster lending growth, this drains capital from the system.

Much depends on US bonds. Higher yields could intensify uncertainty and increase financing costs. Warsaw is not isolated from global developments, so renewed scepticism internationally could bring a correction.

Turnover across the broad market was PLN2.43bn. The WIG rose 1.03%, the blue-chip index gained 0.92% and WIG20 futures advanced 0.92%. Mid- and small-cap stocks also participated: the mWIG40 rose 1.47% and the small-cap index gained 0.9%.

The zloty remains under pressure this year

GBP/PLN is trading at around zł5.18; EUR/PLN at zł4.37; USD/PLN at zł3.89; and CHF/PLN at zł4.71. PLN/JPY is trading at around ¥40.62.