The NASDAQ 100 composite is off about 3.5% since its most recent peak 3 months ago. The smooth of that average decline however, masks a rockier ride for many constituents that are down more than 20% since March. Since tech tends to lead the broader market cycle, the question of the hour is whether the tech and small cap declines(49% of Russell 2000 also down more than 20% in 2 months) are signalling the next phase of cycle weakness in broad risk markets.
Since margin use and financial leverage in the world has never been higher or more concentrated among fewer participants than today, and since several key valuations metrics are at the highest or second highest (behind 2000) ever in history, while volatility has recently been the lowest in 25 years but for the sub-prime-induced-comma that preceded the nightmare of 2008, a broad market decline once it begins next, is likely to be one of the most spectacular loss phases ever recorded in the history books.
As shown in this chart, the price action of the NASDAQ over the past year has a similar look to the price action it followed to the previous market peaks in 2000 and 2007 (smaller inset boxes on left). Fireworks to follow? At some point here, one should count on it.