E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – September 30, 2016 Forecast

December E-mini NASDAQ-100 Index futures are trading slightly better shortly before the cash market opening after clawing back from an early session set-back. Concerns over the financial health of Deutsche Bank are causing the volatile price action. Reports of hedge funds pulling money out of the bank are making investors nervous, encouraging some to take profits or pare positions.

Volatility should be prevalent today as investors continue to monitor the events in Germany. If they feel safe or if there is talk of a bailout then prices could firm. However, since this could turn into a systemic events, any more negative developments could encourage heavy selling pressure ahead of the week-end.

In economic news, personal spending remained flat in August, while income rose 0.2 percent. The core PCE came in as expected at 0.2 percent.

The NASDAQ-100 appears to have firmed after the CEO of Deutsche Bank, John Cryan, told employees in an internal letter that the bank “had strong fundamentals and that recent media reports were causing “unjustified concerns.” This seems to have been enough to diminish the fears in the market that had been pressuring stock prices earlier.

TECHNICAL ANALYSIS

The main trend is up according to the daily swing chart, but momentum is pointing lower. A trade through 4800.75 will turn the main trend to down. A move through 4876.50 will signal a resumption of the uptrend.

The short-term range is 4892.25 to 4800.75. Its 50% level or pivot is 4846.50. This price is controlling the short-term direction of the market.

The main range is 4625.25 to 4892.25. If the sell-off continues and 4800.75 fails as support then look for a possible break into 4758.75 to 4727.25 over the near-term.

FORECAST

BASED ON THE EARLIER PRICE ACTION, THE DIRECTION OF THE MARKET TODAY IS LIKELY TO BE DETERMINED BY TRADER REACTION TO A CLUSTER OF NUMBERS AT 4844.25, 4846.50, 4848.75 AND 4849.25.

A SUSTAINED MOVE OVER 4849.25 WILL INDICATE THE PRESENCE OF BUYERS. THIS COULD CREATE ENOUGH UPSIDE MOMENTUM TO TRIGGER A BREAKOUT INTO THE NEXT DOWNTRENDING ANGLE AT 4868.25. THIS IS FOLLOWED BY THE MAIN TOP AT 4876.50 AND ANOTHER DOWNTRENDING ANGLE AT 4880.25. THIS IS THE LAST POTENTIAL RESISTANCE ANGLE BEFORE THE 4892.25 MAIN TOP.

A SUSTAINED MOVE UNDER 4844.25 WILL SIGNAL THE PRESENCE OF SELLERS. THIS COULD TRIGGER AN ACCELERATION TO THE DOWNSIDE WITH THE NEXT TARGET ANGLES COMING IN AT 4824.75 AND 4812.75. THE LATTER IS THE LAST POTENTIAL SUPPORT ANGLE BEFORE THE 4800.75 MAIN BOTTOM.

LOOK FOR AN UPSIDE BIAS TODAY ON A SUSTAINED MOVE OVER 4849.25 AND A DOWNSIDE BIAS ON A SUSTAINED MOVE UNDER 4844.25.