E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Only Fear for Bulls is Closing Price Reversal Top

March E-mini NASDAQ-100 Index futures are trading higher late Thursday on increased optimism over a coronavirus stimulus bill, while an unexpected rise in weekly jobless claims pointed to further economic stress from the COVID-19 pandemic.

Gains in tech stocks, many of which have benefited from changes in consumer habits because of the pandemic, helped push the NASDAQ Composite to another record high.

At 20:54 GMT, March E-mini NASDAQ-100 Index futures are trading 12739.75, up 69.00 or +0.54%.

In stock related news, MacroGenics Inc jumped 3% after the drug developer said the U.S. Food and Drug Administration had approved its treatment for an advanced type of breast cancer.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was confirmed when buyers took out yesterday’s high. The main trend will change to down when sellers take out the swing bottom at 12217.00.

There is no resistance since we’re at all-time highs so a potentially bearish chart pattern rather than a price level will be the first sign of a top. The best topping pattern will be a closing price reversal top.

Short-Term Outlook

Other than technically oversold conditions, not the oscillator kind, but the volume kind where the selling is greater than the buying, there is no reason to believe this rally can’t continue. Especially since there is no resistance.

Let’s just say that a trend in motion is likely to remain in motion until acted upon by a stronger force. What this means is we’re going to trade the trend as long as the news remains bullish. Traders are pricing in a positive outcome from the rollout of the vaccines and expectations of additional stimulus.

Therefore, we’re not likely to see a meaningful change in trend unless uncertainty develops over the vaccinations. (Remember, investors don’t like uncertainty), or the stimulus negotiations fall apart and are pushed into the New Year. Furthermore, we could see a slight setback if a stimulus deal is reached because it fits the criteria of a “buy the rumor, sell the fact” situation.

For a look at all of today’s economic events, check out our economic calendar.