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E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – November 3, 2015 Forecast

By:
James Hyerczyk
Published: Nov 3, 2015, 05:21 UTC

December E-mini NASDAQ-100 Index futures soared on Monday after recovering from early session weakness. The index reached a new 52-week high on the move.

Daily December E-mini NASDAQ-100 Index

December E-mini NASDAQ-100 Index futures soared on Monday after recovering from early session weakness. The index reached a new 52-week high on the move. The futures contract was primarily driven by the strength in the NASDAQ composite cash index which outperformed all of the major indices.

Yesterday’s rally showed that investors were buying strength. Some analysts believe the rally was driven by investors who didn’t want to miss a year-end surge.

Daily December E-mini NASDAQ-100 Index
Daily December E-mini NASDAQ-100 Index

Technically, the index started weaker, confirming last Friday’s potentially bearish closing price reversal top. Most of the selling occurred during the pre-market session and was a reaction to weakness from China. Buyers came in when the U.S. cash indices opened.

The rally took out Friday’s high at 4690.25, negating the closing price reversal top. The close near the high suggests there may be spillover momentum today.

The first upside target is a steep uptrending angle at 4765.50. A sustained move over this angle will indicate the buying is getting stronger. This could trigger an acceleration to the upside since the next major target is a longer-term uptrending angle at 4840.75.

The daily chart indicates there is plenty of room to the downside, however, there will have to be a major shift in investor sentiment in order to trigger an acceleration to the downside. Investors will have to shift their strategy from “buying strength” to “buying value”.

The best support today is yesterday’s low at 4625.00. A sustained move under this level will indicate the presence of sellers. If volume increases on the selling then a short-term uptrending angle at 4541.50 becomes the primary downside target.

Since the index is still in the window of time for a potentially bearish closing price reversal top, the direction of the market today will be determined by trader reaction to yesterday’s high at 4699.50.

Watch the price action and read the order flow at 4699.50. Trader reaction to this price will tell us whether the bulls or the bears are in control today. A sustained move under Friday’s high at 4690.25 will tell us that Monday’s rally was fueled by buy stops rather than aggressive buying. 

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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