E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Sellers Targeting Nov 2020 Bottom at 10944.00

September E-mini NASDAQ-100 Index futures are down sharply shortly before the cash market close on Monday as the tech-weighted average fell deeper into bear market territory. Beaten-up tech shares continued to take a hit with Netflix, Tesla and Nvidia down more than 6% as the broader based NASDAQ Composite touched a fresh 52-week low and its lowest level since November 2020.

At 19:00 GMT, September E-mini NASDAQ-100 Index futures are trading 11332.25, down 535.50 or -4.51%. The Invesco QQQ Trust ETF (QQQ) is at $275.93, down $12.91 or -4.47%.

Inflation fears, rising interest rates and a possible recession continue to drive the price action. As equities sold off short-term rates jumped on Monday. The benchmark 10-year Treasury rose 20 basis points higher to 3.35%, as investors continued to bet the Fed may have to get more aggressive to squash inflation.

The 2-year Treasury yield was last up 23 basis points to 3.28% and earlier traded above its 10-year counterpart for the first time since April, a so-called yield curve inversion seen as an indicator of a recession.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The downtrend was reaffirmed earlier in the session when sellers took out the previous main bottom at 11521.25. A trade through 12973.75 will change the main trend to up.

The minor trend is also down. A move through 12811.00 will change the minor trend to up. This will shift momentum to the upside.

The index is currently trading inside a long-term retracement zone at 11671.25 to 10468.25. On the upside, the nearest resistance is a minor retracement zone at 12155.75 to 12348.75.

Daily Swing Chart Technical Forecast

Trader reaction to 11867.75 will determine the direction of the September E-mini NASDAQ-100 Index into the close on Monday.

Bearish Scenario

A sustained move under 11867.75 will signal the presence of sellers. Crossing to the weak side of the long-term 50% level at 11671.25 will indicate the selling pressure is getting stronger.

Taking out the main bottom at 11521.25 reaffirmed the downtrend, perhaps generating the momentum needed to challenge the November 2, 2020 main bottom at 10944.00.

If 10944.00 fails then look for the selling to possibly extend into the long-term Fibonacci level at 10468.25.

Bullish Scenario

Overtaking the previous main bottom at 11521.25 will be the first sign of late session strength. Overcoming the long-term Fibonacci level at 11671.25 will indicate the buying is getting stronger. This could trigger a surge into 11867.75. A close over this level will produce a potentially bullish closing price reversal bottom.