Yesterday, the Nasdaq Composite managed to close the day positive although the price continues to retreat towards the key support zone around the 16206 level. The lack of catalysts is leading to a slow and choppy price action with market participants waiting for new information to start positioning with more conviction.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite 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 continue to trade inside the rising wedge, so if the price were to break below the trendline, 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 – 4 hour Timeframe
On the 4 hour chart, we can see that from a risk management perspective, the buyers will have a much better risk to reward setup around the bottom trendline where they will find the confluence of the red 21 moving average and the 50% Fibonacci retracement level. The sellers, on the other hand, will want to see the price breaking lower to start targeting new lows.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the price broke out of the minor support zone around the 16370 level where we had the confluence of the minor trendline and the red 21 moving average. This should point to a drop into the 16206 support where the buyers will likely step in with more conviction to position for a rally into a new all-time high. The sellers, on the other hand, will want to see the price breaking lower to pile in more aggressively and start targeting new lows.
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