Yesterday, the Nasdaq Composite extended the rally following the weaker than expected US PMIs. The commentary was a mixed bag though as there was good news on the inflation front but bad news on the labour market side. The market evidently focused on the fact that it reduced the chances of a more hawkish interest rates path for now which triggered a relief rally.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite yesterday extended the rally and eventually closed the gap with the blue 8 moving average as the market came into better balance after the last week’s selloff. We can see that there’s also the 38.2% Fibonacci retracement level adding confluence to the moving average. This is where we can expect the sellers to step in with a defined risk above the Fibonacci level to position for a drop into new lows. The buyers, on the other hand, will want to see the price breaking higher to increase the bullish bets into the 15929 resistance.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the sellers will have an even better risk to reward setup around the 15929 resistance where they will find the confluence of the red 21 moving average and the 50% Fibonacci retracement level. The buyers will want to break above that resistance zone to increase the bullish bets into a new all-time high.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we now have a minor trendline defining the bullish momentum with the blue 8 moving average adding extra confluence. We can expect the buyers to lean on the trendline to keep bidding the market up into the 15929 resistance. The sellers, on the other hand, will want to see the price breaking below the trendline to increase the bearish bets into new lows.
Upcoming Events
Tomorrow we get the US Q1 GDP and the latest US Jobless Claims figures. On Friday, we conclude the week with the US PCE report.
