Market sell-off deepens: Nasdaq 100, S&P 500, Dow Jones, and Russell 2000 approach key levels [Video]

Is a Market Correction Underway? Small Caps Flash a Major Bearish Signal.

Market overview: Uncertainty grips US futures

As February draws to a close, U.S. equity futures remain under pressure, with major indices facing steep declines and critical technical levels. The Nasdaq 100, S&P 500, Dow Jones, and Russell 2000 are all grappling with significant losses, fueling concerns of an extended sell-off.

Amid ongoing monetary policy uncertainty, rising Treasury yields, and global economic concerns, traders and investors are closely watching for signs of capitulation or stabilization. The next few sessions could determine whether this downturn is a healthy correction or the start of a deeper bearish trend.

Nasdaq 100 Futures: A Pivotal Moment at 20,600

After a brutal six-day decline, the Nasdaq 100 March contract (ENQH25) has tumbled to 20,600, a critical technical threshold. This level has acted as a structural support within the current price framework. If the Index fails to hold here, it could trigger an acceleration in downside momentum, exposing even lower levels.

Since the start of this sell-off, the Nasdaq has lost over 7%, marking one of its worst pullbacks in months. Traders will be closely monitoring price action here, as a failure to reclaim support could open the door to 20228 and 19,800.

Nasdaq Futures price chart, February 28 2025

S&P 500 futures: Support at 5,876 faces a crucial test

The S&P 500 Futures (EPH25) have declined by more than 4% in the past week, testing the key 5,876 support zone. If this level fails to hold, selling pressure could intensify, leading to a deeper correction toward 5,765 or even 5,682.

With recent resistance rejection at 6,171, bulls have been unable to regain control. If sentiment remains weak, a continuation lower is likely, making next week a critical moment for S&P 500 directionality.

S&P 500 Futures price chart, February 28 2025

Dow Jones futures: Searching for stability at 43,221

The Dow Jones Futures (YMH25) has mirrored the broader market’s bearish momentum, dropping over 4% in the past six sessions. Currently, the 43,221 support zone is under threat.

If the Dow breaches this level, it could see further downsides toward 42,725 and 42354, where stronger support lies. A sustained break below these levels could put the Dow on track for its worst February decline.

Dow Jones Futures price chart, February 28 2025

Russell 2000 futures: Small caps flash a bearish signal

The Russell 2000 Futures (RTYH25) have suffered the most among the major indices, plunging over 6% since the broader market sell-off and more than 13% from its November 2024 highs.

As of February 28, 2025, the Index is fast approaching the 2,107 critical zone. A failure to hold this level could trigger an extended pullback or full-scale correction, with the next downside target at 1,968.

Adding to the bearish case, the daily and monthly price charts reveal a head and shoulders reversal pattern, a significant warning signal for small-cap stocks. Given that Russell 2000 often leads broader market trends, this breakdown could have wider implications for risk sentiment.

Russell 2000 Futures price chart, February 28 2025

Conclusion: Is this just a correction, or the start of something bigger?

The market is at a crucial turning point, with the Nasdaq, S&P 500, Dow, and Russell 2000 all trading near major support zones.

• If these levels hold, we may see a short-term rebound.

• A deeper correction could unfold if support breaks, especially in small-cap stocks.

Investors and traders should closely monitor price action in the coming days, as market sentiment and technical levels will dictate the next move.