The Nasdaq Composite is brushing aside the risk of higher interest rates as the strong US economic data coupled with a slow disinflation is giving the market soft landing vibes. Not even hawkish comments from Fed Chair Powell pointing to possibly more than two rate hikes could bring the Nasdaq Composite down. We may keep on seeing dips being bought as long as the US data doesn’t point to a recession. This trading week is shortened as the market will close early today and remain closed tomorrow for the US Independence Day.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite found strong buyers leaning on the red 21 moving average and avoided a deeper pullback to the 38.2% Fibonacci retracement level and the 13174 support. The price is now near the previous 13862 high and the buyers will need to break above it to extend the rally towards the next resistance at 14649.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the moving averages have crossed again to the upside as the bullish momentum prevailed and the buyers are now in control. The sellers may try to position for a downside move again here with a defined risk above the high and target the 13174 support first and a break lower next. The buyers will need to break to the upside if they want to keep the momentum going.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have a good bullish setup for the buyers in case we get a pullback. In fact, we can find a trendline, a previous resistance turned support at 13628, the 61.8% Fibonacci retracement level and the red 21 moving average. This spot has lots of technical confluence, so the buyers are likely to step in here with a defined risk below the trendline and target a break of the high. The sellers, on the other hand, will want to see the price breaking below the trendline to pile in and target a move towards the 13174 support.
Upcoming Events
This week we will see some key economic data beginning with the ISM Manufacturing PMI today, US Jobless Claims and ISM Services PMI on Thursday and the main event of the week: the US NFP report on Friday.
