E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Close Below 8606.00 Will Form Closing Price Reversal Top

The March E-mini NASDAQ-100 Index futures contract is up slightly after hitting an all-time high early Tuesday as investors try to finish higher for the fifth straight day.

The rally was helped by a 3% jump in Netflix after the streaming giant disclosed strong membership growth numbers in key regions, including Asia-Pacific and Europe, the Middle East and Africa.

At 19:52 GMT, March E-mini NASDAQ-100 Index futures are trading 8606.75, up 0.75 or +0.01%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier today when buyers took out yesterday’s high at 8617.50.

A trade through 8189.25 will change the main trend to down. This is highly unlikely. However, since the index is up ten trading days since its last main bottom, it is currently in the window of time to form a potentially bearish closing price reversal top.

The minor trend is also up. A trade through 8319.50 will change the minor trend to down. This will shift momentum to the downside.

Daily Technical Forecast

Based on the early price action and the current price at 8606.75, the direction of the March E-mini NASDAQ-100 Index futures contract into the close is likely to be determined by trader reaction to yesterday’s close at 8606.00.

Bullish Scenario

A sustained move over 8606.00 will indicate the presence of buyers. Taking out the intraday high at 8626.75 will indicate the buying is getting stronger.

Bearish Scenario

A sustained move under 8606.00 will signal the presence of sellers. This will put the index in a position to form a closing price reversal top.

The first downside target is a steep uptrending Gann angle at 8509.25. This angle, moving up at a rate of 32 points per day from the 8189.25 main bottom on December 3, has been guiding the index higher for 10 sessions.

Look for a steep break if this uptrending Gann angle fails as support.

Side Notes

A close under 8606.00 will form a closing price reversal top. This is not a change in trend, but it will indicate the selling is greater than the buying at current price levels. If confirmed, it could trigger the start of a 2 to 3 day correction.