HomeForex MarketNasdaq 100 Worth Forecast: Double High Assist Breached

Nasdaq 100 Worth Forecast: Double High Assist Breached

Nasdaq 100 Speaking Factors:

  • The Nasdaq 100 is bouncing this morning after a stark sell-off yesterday drove all the way down to recent yearly lows. Company earnings are on the radar with Meta/FB and Paypal reporting this afternoon, adopted by a giant day tomorrow with Apple, Amazon and Intel all reporting after the bell. This may occasionally present some additional bounce however the backdrop stays bearish in US equities.
  • The Nasdaq 100 has proven a stark sell-off within the first month of Q2, at present down by greater than -14% from the prior March excessive.
  • I checked out bearish US equities setups as my High Commerce for Q2 and that’s continued to fill-in and subsequent week brings the FOMC charge choice that’s anticipated to convey a 50 bps hike.
  • The evaluation contained in article depends on value motion and chart formations. To study extra about value motion or chart patterns, take a look at our DailyFX Schooling part.

The Nasdaq 100 set a recent yearly low after a brutal session yesterday. Costs pushed under the swing level from the March bounce, which passed off round the FOMC charge choice in the midst of final month, and with the FOMC charge choice on the calendar for per week from now, there’s the specter of extra ache.

Between right here and that Fed assembly is a slew of company earnings reviews and as we noticed yesterday from Microsoft all hope just isn’t but misplaced on the short-term entrance. And later at this time brings a couple of extra reviews from large tech with Meta/FB and Paypal, though tomorrow is the massive day with all of Apple, Amazon and Intel reporting.

At this level, the Nasdaq 100 is greedy on to assist after yesterday’s breach. I’m monitoring this assist from 12,894-13,050, and this space has been in-play since first displaying as resistance in December of 2020. It will definitely grew to become assist the next Could as costs launched as much as recent all-time-highs; but it surely got here again into the image in late-February as sellers have been beginning to acquire management of the matter. A fast bounce developed in late-Feb however value instantly returned a few weeks later and this was the spot that held the lows forward of the FOMC charge choice.

Sellers pushed by means of this space late in yesterday’s session to set a recent yearly low within the Nasdaq 100.

Nasdaq 100 Day by day Worth Chart

Chart ready by James Stanley; Nasdaq 100 on Tradingview

Nasdaq 100 – Double High Breached

Taking a step again to the weekly chart and there’s a double high formation that’s been brewing in early 2022 commerce. The early-February and late-March swing highs match pretty carefully collectively round 15,300, and the low in between these two factors was round 13,000. That gives for roughly 2,300 factors of deviation from the highest to the neckline.

The setup triggers with a breach of assist, resembling we noticed yesterday, and merchants will usually undertaking targets primarily based on the dimensions of the formation. And on this case, given the two,300 factors of deviation that would offer for a focused transfer of two,300 factors, which factors to assist potential all the way down to round 10,750. Maybe coincidentally, that degree correlates with a 38.2% Fibonacci retracement and a value swing from September of 2020.

So, the danger aversion scenario would want to get even worse to drive this state of affairs in direction of fruition however, given the Fed’s stance of current, a transfer of that magnitude can’t be dominated out.

Nasdaq 100 Day by day Worth Chart

nasdaq 100 daily price chart

Chart ready by James Stanley; Nasdaq 100 on Tradingview

Nasdaq 100 Shorter-Time period

That intrusion on assist has been pale in a single day with costs popping again above that assist zone. And given the earnings releases on the calendars mixed with how nicely firms have discovered to handle investor expectations, there might be extra topside right here as shorts cowl following a robust draw back thrust.

And given how aggressively this sell-off priced-in yesterday and final Thursday and Friday, a bounce might be a welcome respite right here. However, there’s remaining resistance potential right here that’s already began to come back into play at 13,184, a swing-low turned swing-high that’s at present being traded by means of. This places focus increased, in direction of the extent round 13,321. And if that doesn’t maintain, there’s a 3rd zone that I’m following from 13,466 as much as 13,500.

Nasdaq 100 30 Minute Worth Chart

Nasdaq 100 30m chart

Chart ready by James Stanley; Nasdaq 100 on Tradingview

— Written by James Stanley, Senior Strategist for DailyFX.com

Contact and observe James on Twitter: @JStanleyFX



Please enter your comment!
Please enter your name here

2 + 16 =

Most Popular