*Mapping the Market: Nasdaq losing its grip on rally

The Nasdaq Composite is trading near its record high, but it has ​gone nowhere for months. It has also lately shown some troubling ​signs in the charts, technical analysis suggests.

Click here ‌for ​a detailed technical analysis chart. Technical analysis uses charts of past price moves to map out where a market might go next. Analysts look for support, which is a floor for prices during a slide. ‌They also look for resistance, which is a ceiling that can cap gains.

Moving averages are particularly useful in this search. They smooth out price swings by averaging prices over a set period, such as 50, 100 or 200 days. Because they update continuously, they rise and fall with the market. Previous ‌highs and lows can also become support or resistance. Another tool is the Fibonacci retracement. It is a mathematical calculation that marks the percentages ‌a market often pulls back to after a big move.

The Nasdaq ended Friday at 25,955.34, which has it below both its 50- and 100-day moving averages near 26,599 and 26,254. It is also in danger of losing support levels at the 23.6% Fibonacci retracement of the March-to-October advance at 26,063, as well as the September 16 low at 25,802.96, according ⁠to data supplied ​by LSEG. Both levels matter because ⁠the index held above them during the mid-October selloff. If the index falls further, chart watchers will focus on support from Gann lines. These are mathematically generated diagonal lines based on ⁠the relationship between time and price. In this case, it is a rising weekly Gann line near 25,500.

Below that, a cluster of longer-term support converges around 25,000. ​It includes the 38.2% Fibonacci retracement of the March-to-October rally, the June low and the 200-day moving average. A decline to that ⁠area would put the Nasdaq down just over 9% from its record close. If buyers can build momentum, they will first need to reclaim the 100- and 50-day moving averages. Last ⁠Wednesday's intraday ​high, the highest price reached during that day's trading, was 26,779, according to data supplied by LSEG. Beyond that, traders may focus on the June 1 intraday high at 27,190 before turning to the October record peak.

What the chart shows: (Mapping the Market is a daily ⁠column written by Reuters journalists. The commentary is based on a technical analysis of financial charts, which helps assess the likelihood of future price moves but does not guarantee the outcome. The column does not constitute investment ‌advice or trading recommendations. )

(Terence ‌Gabriel is a Reuters market analyst. The views expressed are his own. ​Editing by Burton Frierson and Nia Williams)