Yesterday, the Nasdaq Composite fell further as the correction that began last week extended to new lows. There was no bearish catalyst to justify the price action which should indicate that it might have been just some profit taking ahead of key economic releases in the next few days.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite dropped into a key support around the 14770 level where we can also find the red 21 moving average for confluence. This is where we can expect the buyers to step in once again to position for another rally into new highs.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the Nasdaq Composite has been trading inside a rising channel with the price yesterday falling into the lower bound of the channel. We can notice that the lower bound of the channel is right around the swing low and the 38.2% Fibonacci retracement level which adds even more confluence to the bullish setup.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the current price action and the support zone around the 14770 level. This is where the buyers are likely to pile in with a defined risk below the low to position for a rally into new highs. The sellers, on the other hand, will want to see the price breaking further lower to invalidate the bullish setup and position for a drop into the 14050 level.
Upcoming Events
This week is full of key economic data which will culminate with the NFP report on Friday. We begin today with the US ISM Manufacturing PMI and Job Openings and given the recent trends there could be room for disappointment. Later in the day, we will get the release of the FOMC Minutes, but it’s not expected to be market-moving given that it’s three weeks old data. Tomorrow, we will have another slate of US labour market data with the release of the US ADP and Jobless Claims figures. Finally, on Friday, we conclude the week with the NFP report and the ISM Services PMI.
