On the daily chart below for the Nasdaq, we can see that the market keeps on trying to break above the key 12274 resistance level but till now without much success. The strong NFP report on Friday gave the market soft landing vibes due to an expected moderation in inflation, a resilient labour market and a Fed expected to pause in June and cut interest rates by the end of the year. The buyers are still targeting the 13000 level, which is the extension of the big bullish flag created in February.

Nasdaq technical analysis

On the 4 hour chart below, we can see that the market has been stuck in a range for over a month just beneath the key resistance, with just one failed probe near the end of April. It’s been hard for both buyers and sellers to have conviction on what’s next, that’s why the data keeps causing such big movements.

On one hand the market looks forward to the soft landing scenario where the labour market remains healthy and inflation returns back to target, on the other hand the market sees a hard landing where either inflation remains high and the Fed is forced to do more or the labour market deteriorates as the monetary policy lags start to have their effects.

On the 1 hour chart below, we can see more closely the range between the 12274 resistance and the 11900 support. There’s not much a trader can do here than just waiting for a clear breakout on either side and go with the flow. Alternatively, one can “play the range” by selling at resistance and buying at support. This week we have the US CPI report on Wednesday and it’s likely that a beat on expectations would cause a selloff, while a miss would give us a rally.