The Nasdaq Composite rose further yesterday as the lack of bearish catalysts is continuing to support the upside. There’s lots of euphoria in the market following the dovish FOMC decision last week and the data has not deteriorated much lately keeping the soft-landing hopes alive. Nonetheless, the buyers should still be careful going forward as the risk to reward now is very bad considering the risks in 2024 and the ebullient sentiment.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite yesterday rose further as the index continues to move higher for inertia following the dovish FOMC decision and some soft-landing economic data. From a risk management perspective, the buyers would be better off waiting for a pullback into the 14449 level where they will also find the red 21 moving average for confluence before taking new long positions.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the recent breakout above the cycle high is diverging with the MACD. This is generally a sign of weakening momentum often followed by pullbacks or reversals. In this case, we have a trendline connecting the most recent swing lows and the buyers might want to lean on it as they will also find the confluence with the red 21 moving average and the 50% Fibonacci retracement level.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have another minor trendline with a steeper slope. More aggressive buyers might want to lean on it as they also have the red 21 moving average for confluence. The sellers, on the other hand, will want to see the price breaking lower to position for a drop into the 14449 support and upon a further break lower, target the 14050 level.
Upcoming Events
This week is a bit empty on the data front as we head into the Christmas holidays. Today, we have the US Consumer Confidence report. Tomorrow, we get the latest US Jobless Claims data, while on Friday we conclude the week with the US PCE report.
