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E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – No Resistance as Momentum Trade Continues

James Hyerczyk

September E-mini NASDAQ-100 Index futures rallied to another record high on Monday on the back of several high-flying technology stocks. The heavily weighted tech index is now trading more than 20% above its pre-crisis high. Its top two performers were Apple and Tesla Inc, which rallied after their previously announced stock splits.

On Monday, September E-mini NASDAQ-100 Index futures settled at 12114.00, up 122.25 or 1.01%.

The index managed to perform well despite lower closes by Microsoft Corp and Oracle Corp – two stocks tied to the deal for TikTok’s U.S. assets. They fell as China’s new rules around tech exports meant a deal with TikTok owner ByteDance could need Beijing’s approval.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 12165 will signal a resumption of the uptrend on Tuesday.

The main trend will change to down on a move through the nearest swing bottom at 10845.50. This is highly unlikely, however, due to the prolonged move up in terms of price and time, the market is still vulnerable to a closing price reversal top. This chart pattern won’t change the main trend to down, but it could signal that the selling is greater than the buying at current price levels.

As of Monday’s close, the new minor range is 11221.50 to 12165.00. Its retracement zone at 11693.25 to 11582.00 is the first support zone.

The main range is 10845.50 to 12165.00. Its 50% level at 11505.25 is the second potential downside target.

Short-Term Outlook

We’re in a strong momentum trade so investors shouldn’t be looking for resistance. Besides, there is no resistance because the market is at an all-time high.

In a momentum trade, the best thing a trader can do is protect the downside, the upside will take care of itself. Therefore, start watching for signs of a shift in momentum. They include intraday “M” patterns, taking out the previous day’s low and intraday and daily closing price reversal tops.

Based on this assessment, the key number to watch on Tuesday will be Monday’s close at 12114.00.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire