Tesla stock went into reverse and took the Nasdaq with it, possibly signaling near-term top

Tesla stock went into reverse and took the Nasdaq with it, possibly signaling near-term top

Tesla cars are seen at a shopping mall showroom in Los Angeles.

Mark Ralston | AFP | Getty Images

The Nasdaq's stunning reversal, led by Tesla, could signal that big tech has run out of steam and hit a near term top for now,  strategists said.

Some of the hottest Nasdaq names and both the Nasdaq Composite and the Nasdaq 100 hit new highs Monday, before a massive turnaround, which started just before midday as high-flying Tesla suddenly went into reverse.

Tesla was rallying hard early Monday, up 16.2% at a new high of $1,794.99, before sharply reversing to close down 3% to $1,497.06. The stock has been on a tear, crossing above $1,000 for the first time at the end of June.

"Tesla is the poster boy of a parabolic move here, and Tesla started to roll over at about 11:40 a.m.," said Peter Boockvar, chief investment strategist at Bleakley Advisory Group. "That sell-off accelerated and at about 2 p.m., the California headlines exaggerated the move ... We know it's a one-way street. It got really just stretched and overbought and overcrazed in these tech stocks." 

Stocks like Amazon, Adobe, NVIDIA and Facebook all hit new highs before doing an about face, and ending sharply lower. They