Featured Trade: Nasdaq 100 Bulls Under Attack
Kelvin Wong June 12, 2019 10:55 AM
Negative exhaustion signals sighted in Nasdaq 100, at risk of a minor corrective decline.
Short-term technical outlook on Nasdaq 100/US Tech 100 (Tues 12 Jun)
click to enlarge charts
Key technical elements
- The US Tech 100 Index (proxy for the Nasdaq 100 futures) has rallied by 7% from its 03 Jun 2019 low of 6936 with 6 consecutive days of higher closes without any pull-back in price action.
- Negative exhaustion elements have been sighted in the past 2 days where it has shaped a daily bearish “Shooting Star” candlestick pattern on 11 Jun coupled with a bearish divergence signal seen in the shorter-term hourly RSI oscillator that indicates the recent upside momentum of price action has started to abate.
- The Index has also broken below a minor descending trendline that has held previous dips in price action since 03 Jun 2019 with the hourly RSI oscillator that still has room to manoeuvre to the downside before it reaches an extreme oversold level.
Key Levels (1 to 3 days)
Intermediate resistance: 7515
Pivot (key resistance): 7600
Supports: 7350 & 7250/7200
Next resistance: 7745 (Fibonacci expansion)
If the 7600 key short-term pivotal resistance is not surpassed, the Index is likely to shape a potential minor pull-back/corrective decline to target the near-term support at 7350 with a maximum limit set at the 7250/7200 key medium-term support zone (50%/61.8% Fibonacci retracement of the recent rally from 03 Jun 2019 low to 11 Jun 2019 high).
However, an hourly close above 7600 invalidates the pull-back scenario for a continuation of the impulsive upleg towards the next intermediate resistance at 7745.
Please note this product may not be available to trade in all regions.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.