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E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Triangle Pattern Indicates Huge Move Coming

By:
James Hyerczyk
Published: Mar 18, 2020, 16:20 UTC

The longer the June E-mini NASDAQ-100 Index trades between the downtrending Gann angles and the low at 6906.00, the bigger the move, once it decides to breakout.

E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Triangle Pattern Indicates Huge Move Coming

June E-mini NASDAQ-100 Index futures are trading lower but in a range on Wednesday. Although all three major stock indexes are down for the session, the technology-based NASDAQ is outperforming the others. Furthermore, the cash market is trading a lot worse than the futures market. This is because of the difference in their closing times.

The cash market closes an hour before the futures market. In today’s case, the NASDAQ futures kept trading lower on Tuesday after the cash market closed.

At 16:04 GMT, June E-mini NASDAQ-100 Index futures are trading 7150.25, down 242.00 or -3.27%.

Daily June E-mini NASDAQ-100 Index

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 6906.00 will signal a resumption of the downtrend. The market has held this low the past two sessions.

The short-term range is 9006.75 to 6906.00. Its retracement zone at 7056.50 to 8204.25 is the first upside target.

The next major downside target is the December 26, 2018 main bottom at 5847.25.

Daily Technical Forecast

Clearly, there is a divergence between the cash and futures markets and between the NASDAQ Composite and Dow and S&P 500 Index.

The price action the last two days also suggests investors are defending 6906.00, but there hasn’t been enough buyers to generate the upside momentum needed to generate a strong short-covering rally.

Bearish Scenario

Pulling the plug on 6906.00 could be a disaster if sellers come in hard. This could trigger a steep break to 5847.25 over the near-term.

Bullish Scenario

Holding above 6906.00 will indicate the presence of buyers. The first upside objective is a steep downtrending Gann angle at 7348.50. This was tested earlier in the session.

Taking out 7348.50 could trigger a further rally into the next downtrending Gann angle at 7598.75. This one is a potential trigger point for an acceleration to the upside with the first target the short-term 50% level at 7958.50.

Side Notes

It sounds simple on paper, but given the current conditions, a breakout to the upside will have to be driven by a positive, or bullish headline.

The longer the June E-mini NASDAQ-100 Index trades between the downtrending Gann angles and the low at 6906.00, the bigger the move, once it decides to breakout. The combination of the two suggest that something major will happen in the markets between March 23 and March 25.

About the Author

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.

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