The direction of the June E-mini NASDAQ-100 Index futures contract on Wednesday is likely to be determined by trader reaction to 13044.00.
June E-mini NASDAQ-100 Index futures are inching higher early Wednesday as investors await a second day of testimony before the U.S. House Committee on Financial Services by Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen. In the first joint appearance Tuesday, the pair acknowledged the richly valued asset prices in the markets, but said that they are not concerned about financial stability.
At 06:05 GMT, June E-mini NASDAQ-100 Index futures are trading 13031.25, up 25.00 or +0.19%.
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 on March 5 and again on March 19.
The main trend will change to up on a trade through 13287.25. The move will be reaffirmed if buyers can take out 13316.75. A trade through 12681.75 will signal a resumption of the downtrend.
The main range is 13888.00 to 12200.00. Its retracement zone at 13044.00 to 13243.25 is resistance. This zone stopped the buying on Tuesday at 13172.00.
On the downside, the first two support levels are a pair of minor 50% levels at 12984.50 and 12926.75.
The short-term range is 12200.00 to 13287.25. Its retracement zone at 12743.50 to 12615.25 is the key support area. This zone stopped the buying at 12681.75 on March 19.
The direction of the June E-mini NASDAQ-100 Index futures contract on Wednesday is likely to be determined by trader reaction to 13044.00.
A sustained move under 13044.00 will indicate the presence of sellers. The first two downside targets are 12984.50 and 12926.75. The latter is a potential trigger point for an acceleration to the downside.
Taking out 12926.75 with conviction could trigger the start of a steep plunge into the retracement zone at 12743.50 to 12615.25.
A sustained move over 13044.00 will signal the presence of buyers. If this can create enough upside momentum then look for a potential surge into 13172.00, followed by the Fibonacci level at 13243.25 and a pair of main tops at 13287.25 and 13316.75.
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James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.