E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Weakens Under 8360.75, Strengthens Over 8628.50

March E-mini NASDAQ-100 Index futures fell sharply early in the session on Friday, but managed to form a closing price reversal bottom as late session profit-taking drove the market higher into the close. In the cash market, however, the broader-based NASDAQ Composite ended the session nearly flat after posting an intraday loss of 3.5% earlier in the day.

On Friday, March E-mini NASDAQ-100 Index futures settled at 8454.00, up 71.25 or +0.84%.

The index ended the week in correction territory, down 13% below its record high. For the week, the cash market NASDAQ lost 10.5%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, the index did post a potentially bullish closing price reversal bottom so we may see a shift in momentum to the upside if this bottom holds and buyers follow-through to the upside.

The main trend will change to up on a trade through 9763.00. This is highly unlikely, however. A trade through 8574.25 will confirm Friday’s closing price reversal bottom.

A move through 8126.25 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main range is 7494.00 to 9763.00. On Friday, the index closed inside its retracement zone at 8628.50 to 8360.75.

Short-Term Outlook

Basically, the near-term direction of the March E-mini NASDAQ-100 Index on Monday is likely to be determined by trader reaction to the 50% level at 8628.50 and the Fibonacci level at 8360.75.

Based on the close at 8454.00, potential support is the Fib level at 8360.75, the uptrending Gann angle at 8302.00 and Friday’s low at 8126.25.

If 8126.25 fails to hold then look for the selling to possibly extend into another uptrending Gann angle at 7898.00, another uptrending Gann angle at 7696.00, and a pair of main bottoms at 7609.25 and 7494.00.

On the upside, the first target is the 50% level at 8628.50. Overtaking this level could trigger a rally into a steep downtrending Gann angle at 8995.00.

Side Notes

Hedge funds, algorithmic traders and quants are driving the momentum at this time so continue to look for heightened volatility but be prepared for the possibility of wild, two-sided trading.