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James Hyerczyk
E-mini NASDAQ-100 Index

June E-mini NASDAQ-100 Index is trading sharply lower late Friday amid worries over a global economic slowdown. The Federal Reserve’s cautious outlook from earlier in the week is the catalyst behind the price action.

On Wednesday, the Fed left interest rates unchanged as widely expected, but it also reduced the number of potential rate cuts the rest of the year to zero while cutting its economic growth outlook and saying it would end the practice of reducing its massive balance sheet in September.

Weak economic readings from Europe before the regular session opening may have been the trigger for today’s sell-off.

At 18:19 GMT, June E-mini NASDAQ-100 Index futures are trading 7402.00, down 132.50 or -1.76%.

Daily June E-mini NASDAQ-100 Index

 Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum may be getting ready to shift to the downside with the formation of a potentially bearish closing price reversal top. This won’t change the trend, but it could trigger the start of a 2 to 3 correction.

The minor trend is also up. A trade through 7349.50 will change the minor trend to down. This will also shift momentum to the downside.

The short-term range is 6965.75 to 7544.75. Its retracement zone at 7255.25 to 7187.00 is the primary downside target. Since the main trend is up, buyers could show up on the first test of this zone.

The major support is a retracement zone at 7033.75 to 6807.00.


Daily Technical Forecast

Based on the current price at 7402.00, the June E-mini NASDAQ-100 Index is in a position to post a closing price reversal top. This could give the index a downside bias into the close.

The first target is the minor bottom at 7349.50. If this fails then look for the selling to extend into the uptrending Gann angle at 7285.75. Watch for a technical bounce on the first test of this angle.

If 7285.75 fails as support then look for the selling to possibly extend into the 50% level at 7255.25. This is another potential support level. But it is also the trigger point for a potential acceleration to the downside with the Fibonacci level at 7187.00 the next likely downside target.

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