E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – August 27, 2019 Forecast

September E-mini NASDAQ-100 Index futures turned lower just a short while ago after an early session rally failed to attract enough buyers to sustain the move. The early rally was fueled by optimism over U.S.-China trade relations after President Trump said on Monday he expected the U.S. to strike a trade deal with China, citing economic pressure on Beijing. China also called for a resolution to the ongoing dispute.

However, Trump’s claims at the G-7 that China called top U.S. trade negotiators to reignite discussions had been called into question by Hu Xijin, editor-in-chief of the Global Times, who said in a tweet that negotiators from both countries did not talk over the phone. This news helped put a lid on gains. The low volume and breadth during the rally is also a sign that the buying power was weak.

At 15:52 GMT, September E-mini NASDAQ-100 Index futures are trading 7590.50, down 0.50 or -0.01%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 7353.25 will signal a resumption of the downtrend. A trade through 7782.25 will change the main trend to up.

The main range is 6969.00 to 8051.75. Its retracement zone at 7510.25 to 7382.50 is controlling the near-term direction of the market. It is also support.

The short-term range is 8051.75 to 7224.50. Its retracement zone at 7638.25 to 7735.75 is resistance. Crossing to the strong side of this zone will put the index in a bullish position.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 7590.50, the direction of the September E-mini NASDAQ-100 Index the rest of the session is likely to be determined by trader reaction to the short-term 50% level at 7638.25. This level stopped the rally earlier in the session.

Bullish Scenario

A sustained move over 7638.25 will indicate the presence of buyers. If this move creates enough upside momentum then look for a surge into the short-term Fibonacci level at 7735.75. Overtaking this level should lead to a test of the main tops at 7782.25 and 7789.50. The latter is the trigger point for an acceleration to the upside. The next major target is the July 24 main top at 8051.75.

Bearish Scenario

A sustained move under 7638.25 will signal the presence of sellers. If the selling pressure increases then look for a move into the main 50% level at 7510.25. We could see a technical bounce on the first test of this level, but if it fails then the selling to extend into the main Fibonacci level at 7382.50.

The Fib level at 7382.50 is the last technical support before the 7353.25 minor bottom. Taking out this bottom could trigger a break into the main bottom at 7224.50.

Overview

Bullish traders are waiting for the U.S. and China to announce a “cease fire” on tariffs before the trade talks are set to resume in September. On the other hand, a cancellation of the trade talks will be a bearish development.