E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Reaction to 13489.50 – 13625.00 Sets the Tone

June E-mini NASDAQ-100 Index futures are trading sharply higher shortly before the cash market close on Thursday after investors returned to the broad market after three straight days of losses.

The rally was spurred by another solid initial claims report, a recovery in the cryptocurrency market and investor indifference toward the Fed minutes that hinted at considering tapering its asset purchase programs in upcoming meetings.

At 19:55 GMT, June E-mini NASDAQ-100 Index futures are trading 13501.75, up 268.25 or +2.03%.

Helping to lead the market higher were shares of NetEase, Inc, which posted at 7.99% gain. Moderna was up 5.05% and Zoom Video Communications Inc jumped 4.59%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The trend turned up on Thursday when buyers took out 13448.50. A trade through 12954.25 will change the main trend to down.

The main range is 12200.00 to 14064.00. Its retracement zone at 13132.00 to 12912.00 is support. This zone stopped the selling at 12915.00 on May 13 and at 12954.25 on May 19. This zone is controlling the near-term direction of the index.

The short-term range is 14064.00 to 12915.00. Its retracement zone at 13489.50 is the primary upside target. The market is currently testing the lower level of this zone.

The short-term retracement zone is very important because it will determine if the market is ready to move higher, or if a potentially bearish secondary lower top will form.

Daily Swing Chart Technical Forecast

The direction of the June E-mini NASDAQ-100 Index futures contract into the close will be determined by trader reaction to the short-term 50% level at 13489.50.

Bullish Scenario

A sustained move over 13489.50 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the Fibonacci level at 13625.00. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 13489.50 will signal the presence of sellers. This could trigger a quick break into 13238.50. If this level fails then look for the rally to possibly extend into the main retracement zone at 13132.00 to 12912.00.

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