The Nasdaq Composite Index is down 1.5% in the past month and about 3.7% YTD in 2026. The index had been chopping sideways and consolidating 2025 gains, but is now starting to roll over and looks ready for a significant decline.

The index has fallen through the 50 and 100-day EMAs, and the RSI is trending lower at 40 with room to continue dropping before becoming oversold.

While I would usually be looking to buy the dip, the war in Iran has significantly changed my sentiment on the stock market for 2026. I expect the war to drag out much longer than anticipated, energy prices to remain elevated for an extended time frame, and the global economy to take a major hit as a result.

In addition, economic data has started to sour, trade is freezing up between allies, and there are warning signs, such as BlackRock restricting withdrawals from its private credit offerings.

Tech/growth stocks are particularly exposed to these types of risks, as many are pre-revenue, rely on raising capital to sustain operations. If investors get hesitant due to geopolitical instability, it will be harder to raise cash and valuations can drop substantially.

Takeaway: I am still bullish medium and long-term on the technology sector and artificial intelligence in particular, but I think investors are not properly pricing the near-term risk from this war and a slowing economy.