E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – No Change in Trend, but Upside Momentum Could Shift

September E-mini NASDAQ-100 Index futures were set to ease from record levels at the cash market open as a rally in technology stocks cooled and elevated levels of weekly jobless claims fueled worries about a struggling U.S. labor market.

The number of Americans filing for weekly jobless claims fell more than expected to 881,000 in the week-ending August 29, easing from 1 million in the previous week. The government’s closely watched monthly payrolls report is set for Friday.

At 14:30 GMT, September E-mini NASDAQ-100 Index futures are trading 12227.75, down 183.75 or -1.48%.

In other economic news, the Challenger Job Cuts report came in at 116.5%, down from 576.1%. Revised Nonfarm Productivity came in at 10.1%, worse than the 7.3% estimate. Revised Unit Labor Costs came in at 9.0%, down from 12.0%. The Trade Balance showed a 63.6 billion deficit, worse than the -58.2 billion forecast.

At 14:00 GMT, the ISM Non-Manufacturing PMI report is expected to come in at 57.0, down slightly from 58.1.

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through 12465.25 will signal a resumption of the uptrend. The main trend will change to down on a move through the swing bottom at 10845.50.

The minor trend is also up. A trade through 11221.50 will change the minor trend to down. This will confirm a shift in momentum.

The first minor range is 11221.50 to 12465.25. Its 50% level at 11843.25 is the first downside target.

The main range is 10845.50 to 12465.75. Its 50% level at 11655.25 is another potential downside target.

Daily Technical Forecast

The rally has been all about upside momentum. Resistance hasn’t played a role in the move at all.

The first sign of a top will be a shift in momentum. The best sign is not likely today unless the market makes a higher-high and a lower-close.

Taking out yesterday’s low at 12172.25 will be another sign of a shift in momentum because this will make 12454.25 a new minor top, breaking the chart pattern on the minor chart. The last minor top was formed on August 19.

If the downside momentum continues throughout the session then look for a possible break into the uptrending Gann angle at 11933.50, this is followed by the first minor support level at 11843.25. Since the main trend is up, buyers are likely to come in on the first test of these levels.