Yesterday we got another negative day for the Nasdaq Composite as the sellers continue to remain in control. The most likely culprit might have been another big miss in the US Continuing Claims figures which is signalling that the labour market is indeed softening and this might accelerate in the next few months. Moreover, we continue to have the risk of the ground invasion in Gaza over the weekend, so the buyers might not want to hold long positions into the weekend.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite yesterday opened below the bottom trendline and continued lower as the sellers increased their bearish bets and the buyers folded. There’s no support now until the 12274 level, which is the target for the sellers at the moment. That’s where we can expect the buyers to step in with a defined risk below the level to position for a rally back to the 13174 resistance.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see more closely the yesterday’s selloff. The price is now a bit overstretched to the downside as depicted by the distance from the blue 8 moving average. In such instances, we can usually see a pullback into the moving average or some consolidation before the next move.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we now have a good resistance zone around the broken trendline where we can find the confluence with the downward trendline, the red 21 moving average and the 38.2% Fibonacci retracement level. This is where we can expect the sellers to step in again if we get a pullback. The buyers, on the other hand, will want to see the price breaking above the trendline to invalidate the bearish setup and position for a rally into the 13174 resistance.
Today we will get the US PCE report, which is not expected to change anything for the Fed at this point in time.