E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Close Under 8376.50 Forms Closing Price Reversal Top

December E-mini NASDAQ-100 Index futures are expected to open flat-to-lower based on the pre-market trade. Earlier in the session, the index soared to a record high, but then the bottom fell out, taking the market back to unchanged for the session.

The price action suggests the rally was fueled by optimism over a possible U.S.-China trade deal, and the price plunged was triggered by profit-taking and position-squaring ahead of Thursday’s U.S. bank holiday.

At 11:22 GMT, December E-mini NASDAQ-100 Index futures are at 8376.00, down $0.50 or -0.01%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was confirmed earlier today when buyers took out yesterday’s high at 8379.25.

A trade through 8216.25 will change the main trend to down.

The prolonged move up in terms of price and time have also put the index in a position to form a closing price reversal top. If confirmed, this could lead to a 2 to 3 day correction.

The first minor range is 8216.25 to 8422.00. Its 50% level at 8319.00 is support.

The second minor range is 8161.00 to 8422.00. Its 50% level at 8291.50 is also support.

Daily Technical Forecast

Based on the early price action and the current price at 8376.00, the direction of the December E-mini NASDAQ-100 Index on Tuesday is likely to be determined by trader reaction to yesterday’s close at 8376.50.

Bullish Scenario

A sustained move over 8376.50 will indicate the presence of buyers. This could lead to a retest of today’s intraday high at 8422.00. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 8376.50 will signal the presence of sellers. This could lead to a test of the uptrending Gann angle at 8344.25. Since the main trend is up, look for a technical bounce on the first test of this angle.

If 8344.25 fails as support then look for the selling to possibly extend into the pair of 50% levels at 8319.00 and 8291.50. Both levels are likely to attract buyers.

Side Notes

A close under 8376.50 will form a closing price reversal top.