E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Stable on Position-Squaring Ahead of Weekend
September E-mini NASDAQ-100 Index futures are modestly higher late in the session on Friday on profit-taking ahead of the weekend. Nonetheless, the tech-weighted index is still in a position to post its biggest weekly percentage decline in two years as investors grappled with the likelihood of a recession while global central banks tried to drive down inflation.
Fed Says Commitment to Battle Inflation ‘Unconditional’
The Federal Reserve, which earlier this week unveiled its biggest interest rate hike in more than a quarter of a century, on Friday signaled it will not let anything stand in the way of its battle to bring down the searing inflation that’s punishing American households, Reuters reported.
“The Committee’s commitment to restoring price stability – which is necessary for sustaining a strong labor market – is unconditional,” the Fed said in its twice-yearly monetary policy report to Congress, referring to the U.S. central bank’s rate-setting Federal Open Market Committee (FOMC).
The tone of this statement suggests the Fed is likely to continue with its aggressive pace of rate hikes, which means stocks are going to remain weak. Based on the price action throughout the week, this also means traders are likely to continue to sell rallies.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. A trade through the November 2, 2020 main bottom at 10944.00 will reaffirm the downtrend. A move through 12973.75 will change the main trend to up.
The minor trend is also down. A trade through 11794.2 will change the minor trend to up. This will shift momentum to the upside.
The minor range is 11794.25 to 11068.50. Its pivot at 11431.50 is acting like resistance. The next resistance is a long-term 50% level at 11671.25.
On the downside, the major support is a long-term 50% level at 10468.25.
Daily Swing Chart Technical Forecast
Trader reaction to the minor pivot at 11431.50 is likely to determine the direction of the September E-mini NASDAQ-100 Index into the close on Friday.
A sustained move under 11431.25 will indicate the presence of sellers. Taking out the intraday low at 11068.50 will indicate the selling pressure is getting stronger with 10944.00 the next downside target.
A sustained move over 11431.50 will signal the presence of buyers. This could trigger a late session surge into the major 50% level at 11671.25.