Fundamental Overview
The Nasdaq has been mostly consolidating around the recent highs although it managed to rise into a new high yesterday. The election uncertainty is keeping a lid on the bullish momentum for now.
In fact, the election is going to be a major event for the market with a red sweep seen as the most bullish scenario, while a blue sweep could trigger some weakness in the short term. In the bigger picture, the bullish trend should remain intact amid the Fed's easing cycle into a resilient economy.
Nasdaq Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq has been mostly consolidating around the highs although it managed to print a new high yesterday. From a risk management perspective, the buyers will have a better risk to reward setup around the trendline. The sellers, on the other hand, will want to see the price breaking lower to start targeting the next major trendline.
Nasdaq Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that we now have another minor upward trendline defining the current bullish momentum. The buyers will likely lean on the trendline to position for new highs, while the sellers will look for a break lower to target a bigger pullback into the major trendline.
Nasdaq Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the previous high could now act as support. If we get a pullback, we can expect the buyers to lean on it to position for a rally into the all-time high, while the sellers will want to see the price breaking lower to target the trendline around the 20500 level. The red lines define the average daily range for today.
Upcoming Catalysts
Today we get the US ADP and the US GDP. Tomorrow, we have the US PCE, the US Jobless Claims and the US Employment Cost Index. Finally, on Friday, we conclude the week with the US NFP and the US ISM Manufacturing PMI.