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E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Strengthens Over 7624.50, Weakens Under 7621.75

December E-mini NASDAQ-100 Index futures are trading lower Friday after an early session rally failed to attract enough buyers to sustain the move. This should come as no surprise since yesterday’s dramatic reversal to the upside was likely fueled by short-covering, and smart money isn’t going to go long into today’s U.S. Non-Farm Payrolls report.

At 08:55 GMT, December E-mini NASDAQ-100 Index futures are trading 7642.50, down 15.75 or -0.21%.

After yesterday’s rebound rally following a bearish ISM Non-Manufacturing PMI report, it doesn’t make sense to me to trade the headlines on Friday. It’s probably best to watch the price action and read the order flow at every important price level. Furthermore, I expect today’s price action will be fueled by a combination of trend and counter-trend moves.

Daily December E-mini NASDAQ-100 Index
Daily December E-mini NASDAQ-100 Index

Daily Technical Analysis

The main trend is down according to the daily swing chart, however, Thursday’s closing price reversal bottom and subsequent confirmation earlier today shifted momentum to the upside.

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The market is in no position to change the main trend to up given normal volatility, however, a trade through 7474.25 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main range is 7244.50 to 8002.50. Its retracement zone at 7624.50 to 7535.00 was straddled on Wednesday. This zone is potential support today.

The short-term range is 7973.75 to 7474.25. Its retracement zone at 7724.00 to 7783.00 is the next potential upside target. Since the main trend is down, sellers are likely to come in on a test of this area.

Daily Technical Forecast

Based on the early price action, the direction of the December E-mini NASDAQ-100 Index on Friday is likely to be determined by trader reaction to the main 50% level at 7624.50 and the downtrending Gann angle at 7621.75.

Bullish Scenario

A sustained move over 7624.50 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the short-term 50% level at 7724.00, followed by the short-term Fibonacci level at 7783.00 and a downtrending Gann angle at 7797.75.

Bearish Scenario

A sustained move under 7621.75 will signal the presence of sellers. The first target is an uptrending Gann angle at 7580.50. If this fails then look for the selling to possibly extend into the main Fibonacci level at 7535.00.

Taking out 7535.00 will indicate the selling is getting stronger. This could lead to a retest of yesterday’s low at 7474.25.

The next two uptrending Gann angles under 7474.25 are 7412.50 and 7328.50. The latter is the last potential support angle before the 7244.50 main bottom.

Side Notes

Don’t be surprised if traders show a limited reaction to today’s Non-Farm Payrolls report. Often, the major players take the week-end to digest the report and react to the news on Monday.

This article was originally posted on FX Empire

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