September E-mini NASDAQ-100 Index futures are trading lower during the pre-market session. The index took out yesterday’s high by a couple of points before sellers stepped in to stop the move and the buying dried up.
Technical Analysis
The main trend is down according to the daily swing chart. However, momentum is trending higher. The index is also trading inside a retracement area, suggesting investor indecision.
The main trend will change to up on a move through 5949.50. This could lead to a rally into a minor top at 5972.75 and the main top at 5995.75.
A move through 5752.25 will signal a resumption of the downtrend.
The main range is 5995.75 to 5752.25. Its retracement zone at 5874.00 to 5902.75 is currently being tested.
The short-term range is 5949.50 to 5752.25. Its retracement zone is 5850.75 to 5874.00.
The index is currently bouncing inside this retracement zone.
Forecast
Based on the current price at 5870.50 at 0823 GMT, the direction of the market today is likely to be determined by trader reaction to the main 50% level at 5874.00.
A sustained move over 5874.00 will indicate the presence of buyers. This could trigger a surge into the main Fibonacci level at 5902.75, followed by a downtrending angle at 5919.75.
The angle at 5919.75 is not only potential resistance, but also the trigger point for an acceleration into the main top at 5949.50, followed by another downtrending angle at 5957.75.
A sustained move under 5874.00 will signal the presence of sellers. The first target is the short-term 50% level at 5850.75, followed by a downtrending angle at 5843.75 and a steep uptrending angle at 5816.25.
The daily chart opens up to the downside under 5816.25 with the uptrending angle at 5784.25 the next target.
Watch the price action and read the order flow at 5874.00 all session. Trader reaction to this level will tell us if the buying is getting stronger, or if sellers are still in control.
This article was originally posted on FX Empire