Market Meltdown Accelerates as Nasdaq Enters Bear Territory and S&P Tests Key Support Levels

In December 2024, a comprehensive analysis signaled that the US stock market’s historic bull run was nearing exhaustion. The Nasdaq 100, S&P 500, and Dow Jones were all approaching critical inflection points after posting record highs—Nasdaq 100 at 22,010, S&P 500 at 6,020, and Dow Jones at 45,050. The analysis predicted that these levels could mark the start of a significant market reversal. Investors were urged to proceed with caution, as historical patterns hinted at an impending correction phase.

Nasdaq and S&P Plunge as Trade Fears and Technical Breakdowns Intensify Losses

By April 2025, the forecasted downturn has arrived, with the Nasdaq 100 officially entering bear market territory after a 20% drop from its peak. The index is now hovering around 17,285, with steep losses of over 5% in just the last two sessions. The ongoing decline is compounded by fears surrounding prolonged trade tensions and heightened volatility. Technical charts suggest that if support at 17,444 breaks, the index could slide further toward 16,836. Meanwhile, any upward recovery faces resistance at 18,205 and 18,440.

The S&P 500 has not been spared, mirroring the Nasdaq’s weakness with a 16% fall from its highs. The index is currently testing support at 5,151, a level flagged months earlier as a key point in its corrective phase. Persistent selling could push the index lower toward 5,030, 4,955, and possibly 4,834. Recovery attempts may be capped by resistance at 5,225 and 5,300. The rapid 6% drop over just two days reflects rising market panic and a shift in investor sentiment.

Dow Slides as Tariffs, Inflation, and Earnings Fears Fuel Broad Market Turmoil

The Dow Jones Industrial Average, often seen as a bastion of stability, has suffered a 14% drop, exacerbated by China’s retaliatory tariffs against the US following Trump’s “Liberation Day” trade policies. The index currently trades near 38,982, and failure to hold this level could drive it further down to 38,508 or 37,743. A deeper correction may eventually target the key 36,504 level. Resistance is expected at 39,747 and 40,230, making recovery an uphill battle amid ongoing trade conflict.

This downturn is fueled by more than technical weakness—it’s deeply rooted in fundamental disruptions. The Trump administration’s aggressive tariff strategy has reignited global trade tensions, while rising inflation, rate hikes, and concerns over weaker corporate earnings are all weighing heavily on sentiment.

Historical market behavior suggests that such corrections often worsen before bottoming out. Investors are advised to remain cautious, adhere to sound risk management strategies, and watch for stabilization before making bold moves in this volatile environment.