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James Hyerczyk
E-mini NASDAQ-100 Index

September E-mini NASDAQ-100 Index futures are inching higher early Monday on relatively low volume. Although the U.S. released its August Non-Farm Payrolls report on Friday, we may not see the market’s true reaction to the mixed data until today after professional investors have had time to digest the data over the week-end.

At 06:36 GMT, the September E-mini NASDAQ-100 Index futures contract is trading 7871.50, up 13.75 or +0.17%.

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Traders showed little reaction to the jobs report on Friday because the report wasn’t earth-shattering in either direction. The employment change came in below the estimates, but average hourly earnings were better than expected. The news had little impact on the market’s expectations that the U.S. Federal Reserve will cut its benchmark interest rate by 25-basis points when it meets on September 18.

The news didn’t surprise Fed Chairman Jerome Powell either. He said late Friday that the central bank’s pivot this year to lower interest rates has helped sustain U.S. economic growth.

Powell also described the labor market as in “quite a strong position” and the consumer to be “strong” as well.

Most of all, Powell also said, “We’re not forecasting or expecting a recession.”

Daily September E-mini NASDAQ-100 Index

Daily Technical Analysis

The main trend is up according to the daily swing chart. The trend turned up last week when buyers took out three main tops at 7770.50, 7782.25 and 7789.50. The main trend will change to down if sellers take out 7353.25. Although I’d like to see the index hold above the former tops.

The minor trend is also up. A trade through 7580.75 will change the minor trend to down. This will also shift momentum to the downside.

The short-term range is 8051.75 to 7224.50. Its retracement zone at 7735.75 to 7638.00 is support.

The main range is 6969.00 to 8051.75. Its retracement zone at 7510.25 to 7382.50 is major support.


Daily Technical Forecast

Based on the early price action, the direction of the September E-mini NASDAQ-100 Index on Monday is likely to be determined by trader reaction to Friday’s high at 7895.00. The market is up nine days from its last swing bottom, which puts it inside the window of time for a closing price reversal top. So the index is going to blast through 7895.00 and continue the rally or its going to go down. It may even form a closing price reversal top which will be a potentially bearish signal.

Bullish Scenario

A sustained move over 7895.00 will indicate the presence of buyers. This could trigger a spike into a resistance cluster at 7923.75 to 7929.25. This area could stop the rally. Overtaking 7929.25, however, could trigger an acceleration to the upside with 8051.75 the next major upside target.

Bearish Scenario

A sustained move under 7895.00 will signal the presence of sellers. Taking out 7895.00 then turning lower for the session will also indicate that the selling is greater than the buying at current price levels. This could trigger a break into a downtrending Gann angle at 7795.75. Crossing to the weak side of this angle will mean the selling is getting stronger. This could extend the selling into the short-term Fibonacci level at 7735.75.

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