Yesterday, the Nasdaq Composite managed to close around the highs thanks to another slate of positive economic data as the US Q4 GDP surprised to the upside and the inflation details were better than expected. The US Jobless Claims, on the other hand, missed expectations across the board but they are still around cycle lows and given the volatility of the data, the market might need some bigger misses before starting to get worried. Today we conclude the week with the US PCE report, where the market expects the disinflationary trend to remain intact and keep on supporting the soft-landing narrative.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite yesterday managed to close around the highs following strong economic data and falling Treasury yields. From a risk management perspective though, the buyers will have a much better risk to reward setup around the previous high at 15150 where they will also find the confluence with the red 21 moving average, the trendline and the 38.2% Fibonacci retracement level.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see more clearly the bullish setup around the previous high at the 15150 level. If the price were to break below the level, then we can expect the sellers to extend the drop into the trendline where the buyers will have another opportunity to go long. The divergence with the MACD, which is generally a sign of weakening momentum, suggests that a pullback into the 15150 level is very likely.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the recent price action with the price yesterday bouncing on the most recent swing high level and the red 21 moving average. The buyers leant on this support to position for another rally, but if the price were to break lower in the next few days, then we can expect the sellers to pile in to target a drop into the 15150 zone.
