E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Strong Over 10909.75, Weak Under 10708.25

September E-mini NASDAQ-100 Index futures are trading nearly flat shortly before the mid-session. The market is being supported as investors continued to bet on a new coronavirus relief package, but gains were being capped as investors continued to rotate out of high-flying technology stocks into cyclical stocks.

At 15:17 GMT, September E-mini NASDAQ-100 Index futures are at 10819.25, up 15.00 or +0.14%.

Data signaling that a recovery in the labor market was stalling created a little volatility shortly before the opening. The number of Americans filing for unemployment benefits rose last week for the first time in nearly four months, a report from the Labor Department showed.

In other news, Tesla Inc rose 4.2% in the premarket after posting a fourth consecutive quarterly profit, clearing a hurdle that could lead to the electric carmaker’s inclusion in the S&P 500 Index.

Twitter Inc jumped 6% as it reported a bigger-than-expected yearly growth of daily users even as ad sales sank.

Microsoft Corp fell 1.6% as its flagship cloud computing business Azure reported quarterly sales growth of under 50% for the first time ever.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top on July 13.

A trade through 11058.50 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend changes to down on a trade through 10358.75.

The minor trend is up. A trade through 10761.25 will change the minor trend to down. This will confirm the shift in momentum.

The first minor range is 11058.00 to 10761.25. It 50% level at 10909.75 is potential resistance. It appears to be controlling the direction of the index today.

The second minor range is 10358.75 to 11058.00. Its 50% level at 10708.25 is potential support. This level has held as support the last three sessions.

The main range is 9728.75 to 11058.50. Its retracement zone at 10393.50 to 10236.71 is controlling the near-term direction of the market. The lower or Fibonacci level at 10236.71 is a potential trigger point for an acceleration to the downside.

Daily Swing Chart Technical Forecast

Based on the tight trading range, we’re looking for an upside bias to develop on a sustained move over 10909.75 and for the downside bias to resume on a sustained move under 10708.25.

Bullish Scenario

A sustained move over 10909.75 could generate the upside momentum needed to challenge the high at 11058.00 and the main top at 11058.50. The latter is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 10708.25 could trigger an acceleration to the downside with the next major targets a 50% level at 10393.50 and a main bottom at 10358.75.