Nasdaq Composite Technical Analysis


On the daily chart below for the
Nasdaq, we can see that after a brief fall below the range created just beneath
the key 12274 resistance, the price rallied back strongly
and it’s now back again at the resistance. The latest rally was helped by
better than expected data in the US
and the beat in Jobless
after several weeks of misses.

The bad news though is that the ISM
Manufacturing PMI
yesterday beat forecasts and the inflation and
employment sub-indexes returned back into expansion. As long as employment
remains strong with a falling inflation the stock market can rise, but it’s
harder to do so when inflation remains persistently high as well as that may
force the Fed to keep hiking rates.

On the 4 hour chart below, we can
see that the buyers may still be targeting new higher highs with the big bullish
pointing to a 13000 extension. The latest bounce from the 50% Fibonacci
level had no pullbacks and given that the price is
back at the key resistance and the ISM data yesterday is not that bullish, we
may see a pullback here and probably again some consolidation.

On the 1 hour chart below, we can
see the recent fakeout highlighted by the orange circle and then the rally back
towards the top of the range. This week is packed with top tier economic
events like the ISM PMIs, the FOMC and the NFP, so we may see another breakout
but the direction will be given by the data. More inflationary pressures should
be negative for the market, while strong labour market data with easing
inflationary pressures should be positive.

This article was written by ForexLive at

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