Last week, we got some risk aversion in the market
as the tensions in the Middle East intensified. In fact, going into the weekend
the bearish momentum increased as ABC news reported
that the Israeli military got the “green light” to move into Gaza
whenever it was ready. Since we haven’t seen any ground offence over the
weekend, we might see a relief rally today.
Nasdaq Composite Technical
Analysis – Daily Timeframe
Nasdaq Composite Daily
On the daily chart, we can see that the Nasdaq
Composite “confirmed” the downside breakout as the price fell not only below
the key trendline, but also
below the key support around
the 13174 level. The sellers have now a high chance of reaching the 12274
support where we will find the buyers stepping in more strongly to position for
a rally back to the 13174 level.
Nasdaq Composite Technical
Analysis – 4 hour Timeframe
Nasdaq Composite 4 hour
On the 4 hour chart, we can see that the Nasdaq
Composite now sits at the previous lows and that’s where we can expect the
buyers to pile in with a defined risk below the low to position for a relief
rally today into the broken support turned resistance and
hoping for an upside breakout.
Nasdaq Composite Technical
Analysis – 1 hour Timeframe
Nasdaq Composite 1 hour
On the 1 hour chart, we can see that from
a risk management perspective, the sellers would be better off waiting for the
price to pull back into the trendline where we can find the confluence with
the 38.2% Fibonacci
retracement level, the red 21 moving average and
the previous support turned resistance. The buyers, on the other hand, will
want to see the price further breaking higher to invalidate the bearish setup
and increase the bullish bets into the next resistance around the 13400 level.
Upcoming
Events
Tomorrow, we will get the US PMIs and the market might
not like bad figures given the fragile risk sentiment. On Thursday, we will see
the US Jobless Claims data with Continuing Claims recently showing some
softness in the labour market. Finally, on Friday, we will get the US PCE
report, which is not expected to change anything for the Fed at this time.