E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – August 23, 2019 Forecast

September E-mini NASDAQ-100 Index futures are trading higher in the pre-market session, but inside the previous day’s range. The chart pattern indicates investor indecision and impending volatility. Trading at the upper end of its two-week range suggests investors may be expecting some bullish news from Fed Chair Jerome Powell when he delivers a key speech at Jackson Hole at 14:00 GMT.

At 08:53 GMT, September E-mini NASDAQ-100 Index futures are trading 7753.25, up 42.00 or +0.54%.

The market has already priced in a 25-basis point rate cut in September, and 3 or 4 more over the next 12 months. Look for the index to rally if Powell says the Fed will be aggressive in its attempt to perk up the economy and prevent a global recession.

Stocks could plunge if Powell reiterates the message from the Fed’s monetary policy statement and its minutes that the rate cut in July was just a “mid-cycle adjustment”.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher. A trade through 7789.50 will change the main trend to up. A trade through the last main bottom at 7388.25 will signal a resumption of the downtrend.

The minor trend is up. This supports the higher momentum. A trade through 7652.25 will change the minor trend to down. This will also shift momentum to the downside.

The short-term range is 8051.75 to 7224.50. Buyers are trying to establish support at its retracement zone at 7735.75 to 7638.00.

The main retracement zone support is 7510.25 to 7382.50. This zone is controlling the near-term direction of the index.

Daily Technical Forecast

Based on the early price action and the current price at 7753.25, the direction of the September E-mini NASDAQ-100 Index on Friday is likely to be determined by trader reaction to the short-term Fibonacci level at 7735.75.

Bullish Scenario

A sustained move over 7735.75 will indicate the presence of buyers. Crossing to the strong side of an uptrending Gann angle at 7772.25 will put the index in a bullish position. This could create the upside momentum needed to take out the main top at 7789.50. This will change the main trend to up.

Taking out 7789.50 could trigger an acceleration to the upside with the first target angle coming in at 7875.75. This is followed by another downtrending Gann angle at 7963.75. This is the last potential resistance angle before the 8051.75 main top.

Bearish Scenario

A sustained move under 7735.75 will signal the presence of sellers. Crossing to the weak side of the downtrending Gann angle at 7699.75 will indicate the selling is getting stronger. This could lead to a test of the minor bottom at 7652.25 and the short-term 50% level at 7638.00.

The selling pressure will increase under 7638.00 with the next target angle 7580.25. If this fails then look for the selling to extend into the main 50% level at 7510.25, followed by another uptrending Gann angle at 7484.25.

The daily chart starts to open up to the downside under 7484.25 with new targets emerging at 7388.25 and 7382.50. Look out to the downside if 7382.50 fails. Taking out this level could trigger a steep break with 7224.50 the next target.