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

The strong performance this week by the December E-mini NASDAQ-100 Index futures contract has put the market in a position to post a potentially bullish weekly closing price reversal bottom. It won’t mean the trend is changing to up, but if formed and confirmed next week, this could lead to the start of a 2-3 week counter-trend rally.

Weekly Swing Chart Technical Analysis

The main trend is down according to the weekly swing chart. The main trend turned down during the week-ending October 12. A trade through 6580.50 will signal a resumption of the downtrend. This could lead to a further break into a pair of main bottoms at 6399.75 and 6385.25.

A move through 7728.75 will change the main trend to up. A close over 6893.25 on Friday will form the closing price reversal bottom.

The main range is 5916.75 to 7728.75. Its retracement zone is 6822.75 to 6609.00. This zone is controlling the longer-term direction of the index. Earlier in the week, this zone provided support.

The short-term range is 7728.75 to 6580.50. If the rally continues then look for a move into its retracement zone at 7154.75 to 7290.25. Since the main trend is down, sellers are likely to come in on a test of this zone.

Weekly Swing Chart Technical Forecast

Based on the price action this week, the direction of the December E-mini NASDAQ-100 Index into Friday’s close is likely to be determined by trader reaction to last week’s close at 6893.25.

A sustained move over 6893.25 will indicate the presence of buyers. If this move creates enough upside momentum, we could see a move into 7154.75, followed by 7290.25. Look for sellers to come in on the first test of this zone.

A sustained move under 6893.25 will signal the return of sellers. If this generates enough downside momentum then look for the move to extend into the major retracement zone at 6822.75 to 6609.00.

If 6609.00 fails as support then look for the selling to possibly extend into this week’s low at 6580.50, followed by a pair of bottoms at 6399.75, followed by 6385.25.