The Nasdaq Composite yesterday broke through the key swing high level at 14155 as the lack of economic releases gave the green light for the bulls to continue charging higher. This incredible rally is happening right when the US labour market is starting to show clearer signs of weakness. At the moment, the market might be still trading based on interest rates expectations but watch out for pain if the data starts to rollover more quickly. Today, the market participants will also eye Nvidia earnings after the close, which is likely to be more important than the FOMC Minutes release.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite broke through the key swing level at 14155 yesterday and it’s now eyeing the cycle high at 14446. This rally looks like a FOMO play and it’s happening right when the US data, especially on the labour market side, is starting to deteriorate.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the buyers leant on the trendline and the blue 8 moving average to position for a breakout above the key swing level. The next target for the buyers should be the cycle high but watch out for Nvidia earnings today as even a slight disappointment could lead to a pullback.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the price continues to diverge with the MACD. This is generally a sign of weakening momentum often followed by pullbacks or reversals. In this case, the sellers will want to see the price breaking below the trendline and the 14155 level to position for a drop into the lows. The buyers, on the other hand, are likely to continue to lean on the trendline and the 14155 support.
Upcoming Events
This week is pretty empty on the data front with the US on holiday for Thanksgiving Day in the final part of the week. Today, we have the FOMC Meeting Minutes but it's unlikely to be market moving given that it's three-weeks old data. Tomorrow, we have the US Jobless Claims report which is probably going to be the most important release of the week. Finally, on Friday, we conclude the week with the latest US PMIs.
