The events in the Middle East have not impacted the Nasdaq Composite as the market is likely to ignore that as long as the conflict remains confined to just Israel and Hamas. The strong NFP report last Friday and the recent comments from Fed members where they keep signalling cautiousness due to elevated long term Treasury yields, should keep on supporting the rally.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite continues to surge to new highs after bouncing on the key support around the 13174 level. The target for the buyers should be the downward trendline around the 13800 level with a break higher likely leading to the cycle high. We can expect the sellers to step in around the downward trendline to position for another selloff and target the break below the 13174 support.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price yesterday rallied into a resistance level defined by the previous swing low and the minor downward trendline. The sellers might be leaning on this level to invalidate the bullish setup, but the buyers are likely to buy the dip as long as nothing too bad happens on the fundamentals side.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the yesterday’s rally and the pullback into the close. The buyers should pile in around the broken trendline and the previous swing high around the 13500 level to position for another rally into the 13800 level. The sellers, on the other hand, will want to see the price breaking below the 13500 support to increase the bearish momentum into the lows.
Upcoming Events
This week the market is likely to focus on the US CPI report as that’s what might change the expectations around the next FOMC rate decision. Today, we will see the US PPI data and later in the day the FOMC Meeting Minutes. Tomorrow, it will be the time for the US CPI report, and at the same time we will also get the latest Jobless Claims figures. On Friday we conclude the week with the University of Michigan Consumer Sentiment report.
