Nasdaq Composite Technical Analysis

Yesterday,
the Nasdaq Composite came under pressure as we got another slate of hot US
data. In fact, the US PPI beat
expectations across the board followed by strong US
Jobless Claims where we also got a big positive revision to
Continuing Claims data. Despite a miss in the US Retail
Sales, the market started to fear a more hawkish Fed next week with a
possible revision to the Dot Plot showing just two rate cuts this year instead
of three.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite is consolidating around the highs. The buyers are already starting to
pile in around the trendline where we
can also find the red 21 moving average for confluence to
position for a rally into new highs. The sellers, on the other hand, will want
to see the price breaking lower to invalidate the bullish setup and position
for a drop into new lows.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that
the price has been diverging with
the MACD for a
long time. This is generally a sign of weakening momentum often followed by
pullbacks or reversals. We can also notice that the price action formed what
looks like a rising wedge, so if
the price were to break below the trendline and the 15859 level, the sellers
will have much more conviction to look for new lows with the base of the wedge
at 14477 being the ultimate target.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent rangebound price action as the dip-buyers continue to pile
in around the key trendline while the sellers keep pushing lower supported by
the stronger data and the risk of a hawkish FOMC decision next week. A break
above the 16206 level should see the buyers taking back full control and
trigger a rally into a new all-time high.

Upcoming
Events

Today we conclude the week with the US Industrial
Production data and the University of Michigan Consumer Sentiment survey.

This article was written by FL Contributors at www.forexlive.com.