E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – December 2, 2016 Forecast

December E-mini NASDAQ-100 Index futures are called slightly lower shortly before the cash market opening and after the release of the November U.S. Non-Farm Payrolls report. The headline number met expectations, the unemployment rate, however, came in at 4.6%, well below the 4.9% forecast.

Technical Analysis

The main trend is up according to the daily swing chart. However, momentum is to the downside with the formation of the new main top at 4897.75.

Last week’s close was 4868.50. Therefore, a close under this price will produce a potentially bearish closing price reversal top on the weekly chart. If this chart pattern forms and there is a follow-though to the downside next week, we could be looking at a major 2 to 3 week correction.

The main range is 4558.50 to 4897.75. Its retracement zone is 4721.50 to 4683.00. This zone was tested earlier in the session when the market traded down to 4707.25.

Forecast

Based on the current price at 4724.25 and the earlier price action, the direction of the market today is likely to be determined by trader reaction to the 50% level at 4721.50.

A sustained move over 4721.50 will indicate the presence of buyers. If this move generates enough upside action then we could see the rally extend into the next downtrending angle at 4801.75.

A sustained move under 4721.50 will signal the presence of sellers. The next downside target is an uptrending angle at 4686.50, followed closely by the Fibonacci level at 4683.00.

The next target under 4683.00 is the minor bottom from November 14 at 4672.75. This is a potential trigger point for a possible acceleration to the downside with 4622.50 the next target.

Watch the price action and read the order flow at 4721.50 today. Trader reaction to this major 50% level will set the tone for the day.