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E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Major Weekly Price Cluster at 7383.00 to 7383.25 Controlling Direction

James Hyerczyk

June E-mini NASDAQ-100 Index futures closed sharply higher last week, recovering from the prior week’s steep sell-off. The rally drove the index to its highest level since the week-ending October 19, 2018. The move was fueled by optimism over U.S.-China trade relations and softer-than-expected U.S. economic data which likely means the U.S. Federal Reserve will continue its accommodative policy when it begins its two-day policy meeting on Tuesday.

Last week, June E-mini NASDAQ-100 Index futures settled at 7343.25.

Weekly June E-mini NASDAQ-100 Index

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. It turned up last week when buyers took out the previous main top at 7187.50. The market isn’t in a position to change the trend to down, but it is in the window of time for a potentially bearish closing price reversal top. This chart pattern won’t change the trend to down, but it could lead to a 2 to 3 week counter-trend break.

The minor trend is also up. A trade through 6965.75 will change the minor trend to down. This move will also shift momentum to the downside.

The main range is 7767.00 to 5847.25. Its retracement zone at 7033.75 to 6807.00 is controlling the longer-term direction of the index. This zone is key support.

Weekly Technical Forecast

Based on last week’s close at 7343.25, the direction of the June E-mini NASDAQ-100 Index the rest of the week is likely to be determined by trader reaction to a price cluster at 7383.00 to 7383.25.

Bullish Scenario

A sustained move over 7383.25 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to extend into a downtrending Gann angle at 7575.00. Taking out this angle should drive the index into the next downtrending Gann angle at 7671.00. This is the last potential resistance angle before the 7767.00 main top.

Bearish Scenario

A sustained move under .7383.00 will signal the presence of sellers. The weekly chart is wide open to the downside so if this move generates enough downside momentum then look for a potential acceleration into the main Fibonacci level at 7066.75.

Closing Price Reversal Top Set-Up

Taking out last week’s high at 7361.00 then turning lower for the week will put the index in a position to post a potentially bearish closing price reversal top. If formed, this will not change the main trend, but it could lead to a 2 to 3 week correction.

This article was originally posted on FX Empire

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