Nasdaq Composite Technical Analysis

Last Friday, the Nasdaq Composite finished the day
positive as the US PCE report
came mostly in line with expectations. The market has already priced out almost
all the rate cuts that were expected at the beginning of the year and it’s now
expecting just one in September or December. This means that we will need more
worrying data to start pricing in a rate hike and put more downward pressure on
the market. For now, the dip-buyers are again in control as we continue to
erase the losses from the beginning of the month.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite reached a key resistance zone
around the 15929 level where we can also find the confluence of the
50% Fibonacci retracement level
and the red 21 moving average. This is
where the sellers will likely step in with a defined risk above the moving
average to position for a drop into new lows. The buyers, on the other hand,
will want to see the price breaking higher to invalidate the bearish setup and
increase the bullish bets into a new all-time high.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that
the price got a bit overstretched as depicted by the distance from the blue 8
moving average. In such instances, we can generally see a pullback into the
moving average or some consolidation before the next move. In this case, it
would also fit with the bearish setup as we might see at least a rejection from
the resistance zone.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
price action into the resistance level might have formed a bearish flag, but
we will need to see the price breaking the bottom trendline to confirm it. In
case of a breakout to the downside, the measured target would stand around the
14700 level.


Tomorrow, we have the US Q1 Employment Cost Index and
the Consumer Confidence report. On Wednesday, we get the US ADP, the ISM
Manufacturing PMI, the Job Openings and the FOMC rate decision. On Thursday, we
will see the latest US Jobless Claims figures. On Friday, we conclude the week
with the US NFP and ISM Services PMI.

This article was written by FL Contributors at