While Nasdaq is oversold, the key to a sustainable rebound next week is if the Fed comes in with an aggressive rate cut or not. Expect fireworks either way. I think the Fed will not wait till March 20. So much of monetary policy is credibility and the Fed simply has to come in to reassure the capital markets that it will do whatever it takes to prevent a recession. This is only possible with a Fed funds rate of 4.5 per cent.
Stock market discount the future.
Stocks recover well before the economy and corporate profits respond to Fed easing. Moreover, valuations multiples expand, not contract, during periods of Fed easing. While this has not happened yet or Nasdaq due to high profile warnings and total investor cynicism, continued Fed easings could put an intermediate floor under the markets. I doubt it. Let us not forget the context of the tech bubble.