E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Strengthens Over 7735.75, Weakens Under 7638.00

September E-mini NASDAQ-100 Index futures are trading higher on Thursday, helped by higher global bond yields which seem to have eased concerns over a global economic slowdown. Stronger-than-expected trade balance data from China is also underpinning prices.

Money managers are said to be gobbling up underpriced stocks that were beat up earlier in the week. Furthermore, some traders feel the professionals have priced in the worst of the headlines with hedges in safe-have assets like gold and the Japanese Yen.

At 18:20 GMT, September E-mini NASDAQ-100 Index futures are trading 7696.50, up 143.25 or +1.89%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum has been trending higher since the formation of the closing price reversal bottom at 7224.50 on August 6 and it subsequent confirmation.

The main trend will change to up on a trade through 8051.75. This is highly unlikely today, but investors will have to take out a short-term retracement zone first to put it in a position to challenge this top.

Last Friday’s close was 7702.25. This means the index is currently in a position to erase all of this week’s earlier losses and turn higher for the week.

A trade through 7224.50 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main range is 6969.00 to 8051.75. Its retracement zone at 7510.25 to 7382.50 is controlling the near-term direction of the index. It is now support.

The short-term range is 8051.75 to 7224.50. Its retracement zone at 7638.25 to 7735.75 is the primary upside target. This zone is currently being tested. Trader reaction to this zone will tell us if the buying is getting stronger, or if the sellers are forming a secondary lower top.

Daily Technical Forecast

Based on the current price at 7696.50, the direction of the September E-mini NASDAQ-100 Index into the close on Thursday is likely to be determined by trader reaction to the downtrending Gann angle at 7699.75.

Bullish Scenario

Overcoming 7699.75 will indicate the buying is getting stronger. Crossing to the strong side of the uptrending angle at 7721.00 will also indicate strong buying. The trigger point for an acceleration to the upside is the Fibonacci level at 7735.75.

If strong buying and volume comes in over 7735.75 then look for a potential surge into the downtrending Gann angle at 7875.75.

Bearish Scenario

A sustained move under 7699.75 will signal the presence of sellers. This could trigger a break into the short-term 50% level at 7638.25. This is a potential trigger point for an acceleration to the downside with the next target the main 50% level at 7510.25.