Yesterday, the Nasdaq Composite opened lower but closed the day positive as we continue to bounce around heading into the FOMC rate decision today. The lack of economic data was also a contributor to the rangebound price action of the last few days, so the market is waiting for the big risk event before taking a direction. There are risks of a hawkish Fed although the consensus sees the Fed remaining willing to cut rates as they just need some more confidence from the data before making the final decision.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite yesterday opened the day lower and bounced immediately from the key trendline where we had also the red 21 moving average for confluence. The buyers continue to step in with a defined risk below the trendline to position for a rally into a new all-time high. Unfortunately, the price continues to be rejected by the strong 16206 resistance where the sellers keep piling in to position for a break below the trendline to target new lows with a better risk to reward setup.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price has been diverging with the MACD for a long time. This is generally a sign of weakening momentum often followed by pullbacks or reversals. We can also notice that the price action formed what looks like a rising wedge, so if the price were to break below the trendline and the 15859 level, the sellers will have much more conviction to look for new lows with the base of the wedge at 14477 being the ultimate target.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the recent rangebound price action with the price having a hard time breaking the key resistance. The buyers will likely keep on stepping in around the trendline and the 15859 level to position for a break above the resistance, while the sellers will look for a break below those levels to increase the bearish bets into new lows.
Upcoming Events
Today we have the FOMC rate decision where the Fed is expected to keep rates unchanged. Tomorrow, we conclude with the latest US PMIs and Jobless Claims figures.
