E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – In Position to Form Closing Price Reversal Bottom

March E-mini NASDAQ-100 Index futures are edging higher shortly after the cash market close on Friday. With the Dow trading lower, perhaps this is an indication that this phase of the stock market rotation from growth stocks into value stocks is easing.

After early session weakness, the tech-heavy NASDAQ clawed back some losses, rebounding from its worst day in four months even as sentiment remained fragile, with fears of a rise in inflation keeping U.S. bond yields near a one-year high.

At 21:19 GMT, March E-mini NASDAQ-100 Index futures are trading 12890.25, up 58.50 or +0.46%.

Shares of Apple Inc, Amazon.com Inc, Microsoft Corp and Alphabet Inc edged up between 1.1% and 2.6%, but were headed for their worst week in months.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The trend turned down when sellers took out 12727.25 and was reaffirmed when the main bottom at 12727.00 failed to hold. However, since the index was already down eight sessions from its last main top on February 16, there wasn’t much of a follow-through to the downside.

A late trade through 12662.25 will confirm the change in trend. Taking out 13900.25 will change the main trend to up. This is highly unlikely, but the index is currently in a position to post a closing price reversal bottom which could be an early indication that the buying is greater than the selling at current price levels.

The minor trend is also down. A trade through 13353.75 will change the minor trend to up. This will also shift momentum to the upside.

The short-term range is 12491.25 to 13900.50. Its retracement zone at 13029.50 to 13195.75 is new resistance.

The minor range is 13900.50 to 12662.25. Its retracement zone at 13281.50 to 13427.50 is another potential upside target.

Short-Term Outlook

A close over 12831.75 will produce a potentially bullish closing price reversal bottom. It won’t change the main trend to up, but if confirmed, it could trigger the start of a 2 to 3 day counter-trend rally.

The chart pattern could also indicate that the buying is greater than the selling at current price levels. And that a short-covering rally is due in order to alleviate some of the downside pressure.

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