the Nasdaq Composite increased further its gains following the better than
expected US
Jobless Claims as the market continues to be supported by the
goldilocks economy. There’s no notable event now until the US CPI report next
Tuesday, so it won’t be surprising if we start to see a pullback as some profit
taking into the data should be expected.
Nasdaq Composite Technical
Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite
broke the resistance at 15635
and rallied to new highs. The index is approaching the all-time high mark and
that’s certainly what the buyers are targeting at the moment. If we get a
bigger pullback from here, we can expect the buyers to lean on the trendline to
position for the all-time high. The sellers, on the other hand, will want to
see the price breaking below the trendline to invalidate the bullish setup and
position for a drop into the 14477 level.
Nasdaq Composite Technical
Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price
continues to diverge with the
MACD which is
generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, it should be a signal for a pullback at least into the
resistance now turned support at
15635. From a risk management perspective, the buyers shouldn’t chase this
rally and wait for a pullback to either the support or the trendline. The
sellers, on the other hand, will want to see some downside breaks before
stepping in and target new lower lows.
Nasdaq Composite
Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the
price action after the breakout has been choppy with weak momentum. This should
be a sign that the market is primed for a pullback. The buyers will step in
both at the 15635 support and the trendline, while the sellers will pile in at
every break lower.
This article was written by FL Contributors at www.forexlive.com.