E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Strengthens Over 11761.75, Weakens Under 11550.50
December E-mini NASDAQ-100 Index futures are trading sharply lower shortly before the close on Monday as traders express doubts that government policymakers will be able to agree on a new fiscal stimulus package that is needed to help keep the economy on the road to recovery.
At 20:46 GMT, December E-mini NASDAQ-100 Index futures are trading 11685.00, down 113.00 or -0.96%.
In other news, according to Reuters, Netflix Inc will tell investors on Tuesday how the ongoing COVID-19 pandemic affected membership in the third quarter – a period when analysts remain bullish on the company despite the return of live sports and more streaming competition. The video-streaming service was up around 1% ahead of its results on Tuesday.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart, however, momentum is trending lower. A trade through 12249.00 will signal a resumption of the uptrend. The main trend officially turns down on a move through the last swing bottom at 11197.50.
The minor trend is down. This shifted momentum to the downside. The minor trend changed to down when sellers took out 11736.50.
The intermediate range is 12444.75 to 10656.50. Its retracement zone at 11761.75 to 11550.50 is currently being tested. Trader reaction to this zone will likely determine the near-term direction of the index.
The short-term range is 10656.50 to 12249.00. Its retracement zone at 11452.75 to 11264.75 is the next downside target.
Since the main trend is up, all retracement zones are potential support areas until the trend changes to down. The price action also suggests that investors may not be willing to chase the market higher, but instead may be looking for a value area.
We’re going to be watching trader reaction to 11761.75 early Tuesday since this is likely to set the tone for the session. Over the short-run, however, it’s probably best to watch 11761.75 and 11550.50.
Buyers may try to form a support base inside 11761.75 to 11550.50.
We are also confident that a break down under 11550.50 will not mean a major break is coming. Buyers are still likely to come in at 11452.75 to 11264.75.
We’re also pretty confident that new fiscal stimulus is coming, but we don’t know when, or even the size of the deal. In the meantime, investors may continue to probe the downside, looking for a value area. Basically, I still like the upside potential of this market, except I only want to buy at my price. I think chasing a rally is dangerous at this time and at current price levels.