E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Found Early Support on Contract 50% Level at 6822.75

E-mini NASDAQ-100 Index futures are trading higher early Thursday. There has been no follow-through to the downside following yesterday’s steep sell-off. The inside move indicates investor indecision and impending volatility. Although the trend is down on the daily swing chart, the prolonged move down in terms of price and time along with the test of the futures contract 50% level may have put the market in a position to post a closing price reversal bottom. This is probably the only pattern that could stop the price slide at this time.

At 0632 GMT, December E-mini NASDAQ-100 Index futures are trading 6879.25, up 43.00 or +0.65%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 6785.75 will indicate the selling is getting stronger. Potential downside targets are a series of bottoms at 6590.50, 6493.00 and 6385.25. The daily chart opens up to the downside under 6385.25 with 5916.75 the next major target.

The main trend changes to up on a trade through 7368.50.

The minor trend is also down. The minor range is 7175.00 to 6785.75. Its 50% level or pivot at 6980.50 is the first upside target.

The main range is the contract range at 5916.75 to 7728.75. Its retracement zone is 6822.75 to 6609.00. This zone was tested on Wednesday when the index hit a low of 6785.75.

Daily Swing Chart Technical Forecast

Based on yesterday’s close at 6836.25 and the early price action, the direction of the December E-mini NASDAQ-100 Index futures contract is likely to be determined by trader reaction to yesterday’s low at 6785.75.

Bullish Scenario

A sustained move over 6785.75 will indicate the presence of buyers. Overcoming the contract’s 50% level at 6822.75 will indicate the buying is getting stronger. This could create the upside momentum needed to challenge the minor pivot at 6980.50.

Overcoming the pivot at 6980.50 will be another sign of buyers. The next target is 7175.00. The minor trend will change to up on a move through this level and momentum will shift to the upside.

Bearish Scenario

A sustained move under 6785.75 will signal the presence of sellers. The daily chart is wide open to the downside under this level with the first target zone 6609.00 to 6590.50. Look for a technical bounce on the first test of this area. If 6590.50 fails as support then sellers could extend the break into 6493.00 to 6385.25.

Closing Price Reversal Bottom Scenario

Taking out 6785.75 then regaining yesterday’s close at 6836.25 will put the index in a position to form a potentially bullish closing price reversal bottom. This could trigger the start of a 2 to 3 day counter-trend rally.