I last wrote about FNGU (an exchange-traded note that tracks 3x the daily price movement on an index of US-listed technology and consumer discretionary companies) in my Dec. 20 post.

As you can see from the following monthly chart, it failed to recapture and hold above the 33.00 level, and it instead closed at 25.74 on Friday. It's approaching a price support zone from 20.00 to 25.00. We may see it attempt to stabilize somewhere within this zone in the coming days. If not, a drop and hold below 20.00 could be catastrophic for the technology sector.

The ten stocks that make up FNGU are shown on the following one-year daily charts. Most of them are at or near price support, with the exception of Twitter (TWTR), which is well below for the year.

The following daily ratio chart of the NDX:VXN ratio shows that a bearish moving average Death Cross formed several days ago, and price has fallen below the major support of 500.

I noted on Jan. 21 that a Death Cross had also formed on the SPX:VIX ratio and that the 'sell the rip' traders had overtaken the 'buy the dippers.' The same is true for this ratio. If the NDX:VXN drops and holds below 400, its next major support level sits at 300, followed by 250 and 200, respectively.

In conclusion, if FNGU falls and holds below 25.00, the NDX:VIX ratio falls and holds below 400, and the ten FNGU stocks fall and hold below their near-term price support levels, then I wouldn't be surprised to see FNGU retest the lower edge of its support zone at 20.00.

A drop and hold below 20.00 on FNGU and below 300 on the NDX:VXN ratio could be catastrophic for the technology sector. Keep an eye on the price action and support levels on the SPX and SPX:VIX ratio for possible corroborating clues in this regard.