Nasdaq Composite Technical Analysis

Yesterday, the Nasdaq Composite erased all the
losses from the Fed’s selloff as the market continues to trade the goldilocks
economy. In fact, the ISM Manufacturing PMI
surprised to the upside with the new orders index, which is regarded as a
leading indicator, jumping back into expansion. Moreover, after the close we
had some good earnings reports from the big names with META not only tripling
profits but even announcing its first-ever dividend. Today all eyes will be on the US NFP report
which is expected at 180K with estimates ranging from a low of 120K to a high
of 290K.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq Composite
yesterday bounced from the key support zone
around the 15150 level where we had the confluence of the trendline, the
38.2% Fibonacci retracement level
and the red 21 moving average. This is
where the buyers stepped in with a defined risk below the trendline to position
for a rally into new highs. The sellers, on the other hand, will want to see
the price reversing and breaking below the trendline to invalidate the bullish trend
and position for a drop into the 14477 level.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see more clearly the bounce
from the support at the 15150 level. Given the strong gains after the close
from the major stocks, we can expect the index to open around the highs. The
buyers might want to pile in to join the bullish momentum and look for new
higher highs. The sellers, on the other hand, could fade the reaction to the
earnings and position short with a defined risk above the high looking for a
break below the trendline.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we
had an important level around 15400 where there was also the confluence with
the red 21 moving average and the 50% Fibonacci retracement level. If we get a
pullback from the highs, the buyers will likely lean on the level as they will
have a better risk to reward setup to target new highs. The sellers, on the
other hand, will want to see the price breaking lower to increase the bearish
bets into new lows.

This article was written by FL Contributors at

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