E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – December 18, 2018 Forecast

March E-mini NASDAQ-100 Index futures are expected to open higher based on the pre-market trade. The lack of follow-through to the downside after yesterday’s steep sell-off suggests investors may be paring positions ahead of the start of the U.S. Federal Reserve’s two-day monetary policy meeting. Central bank policymakers are widely expected to hike its benchmark for a fourth and final time of 2018.

At 1305 GMT, March E-mini NASDAQ-100 Index futures are trading 6538.50, up 49.25 or +0.76%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The downtrend was reaffirmed on Monday when sellers took out the last main bottom at 6560.25. The selling was also strong enough to take out the November 20 bottom at 6480.75, however, the selling stopped short of the February 8 bottom at 6399.25.

The short-term range is 6897.00 to 6423.25. If counter-trend buyers can generate enough upside momentum then we could see a test of its retracement zone at 6660.25 to 6716.00.

The main range is 7169.00 to 6423.25. Its retracement zone is 6796.25 to 6884.25.

Daily Swing Chart Technical Forecast

Today is the tenth day down from the 7169.00 main top. This puts the index in the window of time for a closing price reversal bottom.

Based on this potential chart pattern, the direction of the March E-mini NASDAQ-100 Index is likely to be determined by trader reaction to yesterday’s low at 6423.25.

Bullish Scenario

A sustained move over 6423.25 will indicate the presence of counter-trend buyers. If this move can generate enough upside momentum then look for buyers to make a run at the retracement zone at 6660.25 to 6716.00. Since the main trend is down, sellers are likely to come in on a test of this zone.

Bearish Scenario

Taking out 6423.00 and sustaining the move will signal the presence of sellers. If the downside pressure continues to build then we could see an eventual break into a pair of bottoms at 6399.25 and 6383.75. The daily chart starts to open up to the downside under 6383.75 with 6266.25 the next major target. This price is a potential trigger point for an acceleration into 5880.50.

Closing Price Reversal Pattern

A third pattern that could develop is the potentially bullish closing price reversal bottom. Taking out 6423.25 then turning higher for the session will put the market in a position to form this chart pattern. The trend won’t change to up on the move, but we could see a 2 to 3 day counter-trend rally.