E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Early Weakness Targets 13181.75 – 13132.00

June E-mini NASDAQ-100 Index futures are inching lower on Monday following last week’s sell-off triggered by inflation jitters. In the cash market last week, the tech-heavy NASDAQ Composite, which got hit particularly hard by higher price pressures, dropped 2.3%.

Data last week showed the Consumer Price Index (CPI) jumped 4.2% from a year earlier in April, the fastest rate since 2008, which intensified fears that the Federal Reserve could be forced to start tapering its easy monetary policy if higher price pressures are sustained.

At 09:42 GMT, June E-mini NASDAQ-100 Index futures are trading 13351.00, down 36.00 or -0.27%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, momentum shifted to the upside on May 13 with the formation of a closing price reversal bottom.

A trade through 14064.00 will change the main trend to up. A move through 12915.00 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main range is 12200.00 to 14064.00. Its retracement zone at 13132.00 to 12912.00 is support. This zone stopped the selling at 12915.00 last week.

The short-term range is 14064.00 to 12915.00. Its retracement zone at 13489.50 to 13625.00 is the next upside target and potential resistance.

Daily Swing Chart Technical Forecast

Traders will have two choices today. They could drive the market into the retracement zone at 13489.50 to 13625.00, or they can play for a pullback into the 50% level at 13132.00.

Bullish Scenario

A rally into 13489.50 to 13625.00 will indicate the presence of buyers. However, since the main trend is down, sellers are likely to come in on a test of this area. They will be trying to form a potentially bearish secondary lower top. Taking out 13625.00, however, will indicate the buying is getting stronger. This could trigger an acceleration to the upside.

Bearish Scenario

The inability to sustain a rally over 13489.50 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into the main 50% level at 13132.00.

Aggressive counter-trend buyers will be coming in on a test of this level. They will be trying to form a potentially bullish secondary higher bottom. If 13132.00 fails as support then look for the selling to possibly extend into the support cluster at 12915.00 to 12912.50.