E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Strength Over 16374.50, Weakness Under 16318.00

December E-mini NASDAQ-100 Index futures posted its best three days since March on Tuesday, gaining nearly 2.91%. Tech stocks have recovered this week from last week’s market rout on fears of the omicron COVID variant and a possible faster-than-expected taper of the Federal Reserve’s bond buying program. Technology stocks have lead the way, with the NASDAQ Composite up 4% since Monday.

On Tuesday, December E-mini NASDAQ-100 Index futures settled at 16318.00, up 475.25 or +2.91%. The Invesco QQQ Trust Series 1 ETF finished at $397.95, up $11.75 or +3.04%.

Investors piled back into tech heavyweights and semiconductors in particular after Intel announced plans to take its self-driving car unit public.

Tech giant Apple jumped 3.54% after Morgan Stanley’s Katy Huberty raised Apple’s price target from $164 to $200 and maintained an overweight rating. The analyst believes that new products from Apple, like an augmented reality headset or self-driving car, aren’t yet baked into the share price.

The Philadelphia Semiconductor Index posted its biggest rise since early March of this year.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher. A trade through 16456.25 will change the main trend to up. A move through 15538.00 will signal a resumption of the downtrend.

The minor trend is up. This is controlling the momentum. It changed to up on Tuesday when buyers took out the minor top at 16121.75.

The short-term range is 16767.50 to 15538.00. The index is trading on the strong side of its pivot at 16152.75, making it support.

The major support zone is clustered at 15676.50, 15567.50, 15419.00 and 15284.50.

Daily Swing Chart Technical Forecast

The direction of the December E-mini NASDAQ-100 Index early Wednesday is likely to be determined by trader reaction to 16318.00.

Bullish Scenario

A sustained move over 16318.00 will indicate the presence of buyers. The first upside target is the main top at 16456.25. Taking out this level will change the main trend to up. This could trigger an acceleration to the upside with 16767.50 the next major upside target.

Bearish Scenario

A sustained move under 16318.00 will signal the presence of sellers. If this creates enough downside momentum then look for a break into the pivot at 16152.75.

If 16152.75 fails as support then look for the selling to possibly extend into a minor pivot at 15977.75. This is the last potential support before the main bottom at 15538.00.