Nasdaq 100 Forecast: Global Chip Rout Deepens With 27,142 Now in View

AI Trade Unwinds as Chip Selling Goes Global

The semiconductor selloff ran through its third session Friday and this time it went global. Asia sold first, Europe followed, and the U.S. premarket is extending the damage with memory, chip equipment, and software all getting hit at once.

Strong earnings are not protecting expensive stocks anymore and the market is forcing valuations back toward levels that can be supported by what companies are actually delivering. Banks and energy are finding buyers on their own catalysts while the Iran escalation keeps crude elevated and the rate risk pointed directly at the growth stocks leading the decline.

At 12:19 GMT, Dow Futures are trading 52488.00, down 298.00, down 0.56%. S&P 500 Index Futures are at 7512.00, down 65.75 or -0.87% and Nasdaq Futures are trading 28695.00, down 530.75 or 1.82%.

Daily September E-mini Nasdaq-100 Index Futures Technical Analysis

September E-mini Nasdaq-100 Index futures have been in a freefall since crossing to the weak side of its 50-day moving average at 29858.11 earlier in the week. Sellers are now expected to go after the swing bottoms that have been propping up the index since early June in a clear sign of an overvalued market.

In my opinion, investors have flipped the switch and are now looking for value. The long-term range is 23184.50 to 31100.00. Its 50% to 61.8% retracement zone at 27142.25 to 26208.25 is the first value zone target. Inside this value zone is the 200-day moving average at 26868.85.

Now, we can see some back and forth trading for days, but I’m pretty convinced based on my studies of previous chart patterns that the market is due for a reset and this retracement area is my best initial target.

Chip Selling Extends to a Third Day Across Three Continents

The VanEck Semiconductor ETF is down nearly 7.0% for the week and headed toward its third weekly loss in four. The selling started in Asia, moved through Europe, and hit the U.S. premarket before the opening bell. When the entire supply chain sells across three continents on the same morning, traders are not reacting to one company’s report. They are reducing exposure to the group.

Memory is taking the worst of it. The Roundhill Memory ETF is headed toward a nearly 20% weekly loss. Memory had been one of the strongest parts of the AI trade and the unwind is dragging everything connected to it lower.

Software Confirms This Is Bigger Than Chips

The iShares Expanded Tech-Software Sector ETF is headed toward its sixth losing week in seven. Alphabet is down in the pre-market session after declining on Thursday. Chips and software selling together means the market is trimming the entire AI trade, not rotating within tech. Traders want to see returns on the spending, and right now nobody is getting the benefit of the doubt.

Beats Are Not Enough in This Market

Netflix is down on results that came in roughly in line. Intuitive Surgical dropped even after beating estimates by a wide margin and maintaining its full-year outlook. Two companies in different industries with the same reaction. The market is no longer carrying premium valuations without a reason to pay up again, and neither report provided one.

Stocks in the News

SpaceX fell after a Starship test flight aborted at the last second when several engines failed to start. BP and ConocoPhillips both gained ahead of expected announcements covering new investments in Iraq worth potentially tens of billions. Alcoa slipped after cutting its 2026 alumina production forecast despite beating quarterly estimates. Truist Financial gained after beating earnings expectations. Verizon rose on plans to sell 274 retail stores and cut about 500 corporate jobs as part of its restructuring.

What to Watch

The chip group controls Friday’s direction. Three days of global selling with memory stocks posting weekly losses near 19% is not profit-taking. That is a crowded trade breaking down and the buyers who drove the run are not stepping back in yet. Software falling alongside chips makes it harder to argue this stays contained to one sector, and strong earnings from companies like Intuitive Surgical and Netflix getting sold tells you the problem has spread beyond AI names into any stock carrying a premium valuation without enough forward guidance to justify it.

The Iran escalation is not letting up either. Six consecutive nights of U.S. strikes and Iranian attacks on U.S. positions in Syria and Bahrain are keeping crude elevated and the rate pressure pointed at the same growth stocks already under the most selling pressure.

The Nasdaq-100 futures have been in freefall since losing the 50-day moving average and investors are now looking for value, not chasing momentum. The market has a clear downside target and the chart pattern supports a reset into that zone before any meaningful buying interest develops. Buyers need to show up before this correction extends into something the bulls cannot recover from quickly.

More Information in our Economic Calendar.