E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Testing Balance Point at 11550.75

December E-mini NASDAQ-100 Index futures hit its highest level since September 4 on Thursday as investors continued to bet on a fiscal stimulus deal between House Democrats and Senate Republicans.

Meanwhile hope for more stimulus was boosted by the weekly initial claims report that showed the number of Americans filing for jobless benefits fell to 837,000 in the week ended September 26, but claims could rise again over the next few weeks as businesses cut more jobs to ride out the recession.

At 18:08 GMT, December E-mini NASDAQ-100 Index futures are trading 11512.00, up 104.75 or +0.92%. This is down from a high of 11596.00.

Gains on Thursday were again led by the consumer discretionary sector, which includes Amazon.com Inc, and the information technology index.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the intraday high at 11596.00 will reaffirm the uptrend.

The minor trend is also up. A move through 11167.00 will change the minor trend to down. This will also shift momentum to the downside.

The short-term range is 12444.75 to 10656.50. Its retracement zone at 11550.75 to 11761.75 is resistance. This area stopped the rally at 11596.00 earlier today.

The first minor range is 11167.00 to 11596.00. Its 50% level at 11381.50 is support. The second minor range is 10656.50 to 11596.00. Its 50% level at 11126.25 is another potential support level.

If 11126.25 fails then look for an acceleration into the main 50% level at 10917.50.

Short-Term Outlook

We’ve hit our main objective – a 50% correction of the September break. This means that sellers and buyers have reached a balance point. So the next major more will be determined by trader reaction to 11550.75.

Look for a bullish tone over 11550.75 and a bearish tone under 11550.50. It’s that simple. Buyers want to see a new high, sellers are going to try to form a potentially bearish secondary lower top.