The chart suggests that the Nasdaq 100 could reach a ‘significant low’ this week, Jim said

CNBC’s Jim Kramer said Wednesday that the Nasdaq 100 could reach lower levels this week and give investors a chance to offload some bad performing stocks, leaning on the analysis of technology analyst Caroline Boroden.

“The charts explained by Caroline Boroden suggest that the Nasdaq 100 could be a significant downtrend this week – and perhaps it has already happened.

“However, you don’t want to be too attached to the move because Boroden says the underlying technical picture remains ugly. Still, you can get a good chance to unload some technology here to raise money to buy other things. Time is moving forward, “he added.

The Dow Jones Industrial Average rose 1.01% on Wednesday, while the S&P 500 rose 1.12%. Nasdaq Composite rose 2.03%.

Boroden uses Fibonacci techniques to predict the market. A cluster in the Fibonacci timing cycle coming at about the same time means a stock or index could move in the opposite direction, Kramer explained, adding that he knew this was how the market would go down in mid-March.

Nasdaq 100 “From that cluster of Fibonacci timing cycles he mentioned in March almost straightened out,” Dr. Kramer. He added that Boroden is keeping an eye on both time and price parameters to find out where the next market is low where investors can trade.

“On the timing front, he says he has two periods where the Nasdaq 100 is likely to be a significant low. The first period is yesterday and today,” Kramer said. “In other words, today’s rebound may have more power than you expected.”

That said, according to Boroden, although these Fibonacci timing cycles are certainly helpful … about 60% of the time when we see these reverse signals we find a real reversal of the trend, “he added.

In terms of pricing, Boroden said there is a possibility that the index will reach its lowest point since March 14, according to Kramer. Still, he believes the Nasdaq 100 is in rough shape because its price is below the 200-day simple moving average and the short-term 50-day moving average, he added.

Boroden also sees a five-day and 13-day moving average, Kramer said.

“When the five-day goes above the 13-day … that’s his favorite buy trigger. When the five-day goes below the 13-day, it’s his favorite selling trigger. Not in the region, “he said.

This means that even if the Nasdaq-100 reaches a significant low, investors should still be prepared for the index another “negative failure,” Kramer said.

“He’s seen it, we’re definitely not out of the woods yet, and he’s definitely not making a clear call,” he added.

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