Last week, we got another set of good economic data
for the US with signs of further disinflation in the core inflation measures.
The soft-landing narrative should be in full swing with resilient labour
market, lower inflation, and lower inflation expectations. Nonetheless, the
Nasdaq Composite price action remains rangebound, and at this point it might
even be because we are getting near to the FOMC rate decision. Looking forward,
the uncertainty is very high as we either get a soft or hard landing, but the
weakness in other economies like the Eurozone skews the picture to the worse
scenario.
Nasdaq Composite Technical
Analysis – Daily Timeframe
Nasdaq Composite Daily
On the daily chart, we can see that the Nasdaq
Composite remains rangebound around the red 21 moving average which is
acting as dynamic support. This is the last line of defence for the buyers, so
we are likely to see them stepping in with a defined risk below the moving
average to target a rally into the 14649 resistance. The
recent break and retest of the broken trendline though
gives the sellers more chances of success and the 13174 support with another
major trendline for confluence looks
attractive.
Nasdaq Composite Technical
Analysis – 4 hour Timeframe
Nasdaq Composite 4 hour
On the 4 hour chart, we can see that the price has
recently broke out of the counter trendline that was defining the bearish flag pattern.
This should be another confirmation that a bigger move to the downside might be
in the cards with the moving averages crossing to the downside and the price
breaking through the support zone. The sellers should now pile in even more
aggressively and target the 13174 level.
Nasdaq Composite Technical
Analysis – 1 hour Timeframe
Nasdaq Composite 1 hour
On the 1 hour chart, we can see that the
selloff last Friday led to a break below the lower bound of the mini range. The
bias is now bearish, and we should see the sellers having full control. The
buyers, on the other hand, will need the price to rally back above the 13822 support
zone to invalidate the bearish setup and position for more upside.
Upcoming
Events
This week has just a couple of important economic
releases with the FOMC rate decision on Wednesday being the highlight. The Fed
is expected to keep rates unchanged, and the market will focus more on the Dot
Plot and Fed Chair Powell’s press conference, although he’s likely to repeat
that they remain data dependent. Moving on to Thursday, we will see another US
Jobless Claims report, while on Friday we conclude the week with the US PMIs
data.