E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Reversal Tops Indicating Top Heavy MarketThe main trend is up, but momentum is trending lower with the formation of the closing price reversal top on Thursday and its confirmation on Friday.
June E-mini NASDAQ-100 Index futures settled higher on Friday after clawing back all of its earlier losses. Volume was extremely low as most major players took off early ahead of the long U.S. holiday. For the week, the cash market NASDAQ Composite rose more than 3%.
The NASDAQ Composite Index is down about 5% from its February 19 record high, helped in recent weeks by gains in Microsoft, Amazon, Facebook and other heavyweight companies seen coming out of the economic downturn stronger than their smaller rivals.
Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
At Friday’s close, June E-mini NASDAQ-100 index futures were trading 9421.50, up 65.75 or +0.70%.
Prices were lower early in the session on Friday as investors gauged China-U.S. tensions and amid ongoing uncertainty about the pace of economic recovery from the coronavirus.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart, but momentum is trending lower with the formation of the closing price reversal top on Thursday and its subsequent confirmation earlier on Friday.
A trade through 9510.75 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will change to down on a move through 8847.00.
The minor trend is down. This is also a sign of a shift in momentum.
The minor range is 8847.00 to 9510.75. Its 50% level at 9178.75 is the next downside target.
The short-term range is 8556.25 to 9510.75. Its retracement zone at 9033.25 to 8920.75 is the second downside target.
Last week there were two closing price reversal tops formed on the daily chart. One was negated, the other is still intact. The chart pattern isn’t indicating a change in trend, but it does suggest that the selling is greater than the buying at current price levels. This could lead to a two to three day counter-trend correction.