An easing of tensions over U.S.-Mexico trade relations is helping to drive up June E-mini NASDAQ-100 Index futures on Monday. The market is also being supported by expectations of an interest rate cut by the U.S. Federal Reserve in either June or July. The rally initially began last week when Fed Chair Jerome Powell made remarks that opened the door to a potential easing of monetary policy.
At 14:40 GMT, June E-mini NASDAQ-100 Index futures are trading 7533.00, up 113.50 or +1.50%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. However, momentum shifted to the upside with the formation of a weekly closing price reversal bottom and the subsequent confirmation of the chart pattern this morning.
A trade through 7641.00 will change the main trend to up. This move could create enough upside momentum to eventually challenge the next main top at 7879.50. The index is in no position to change the main trend to down, but we’re up five sessions since the last main bottom so start watching for a closing price reversal top.
The main range is 7879.50 to 6941.25. Its retracement zone at 7410.25 to 7521.00 is controlling the near-term direction of the index. The index is straddling the upper or Fibonacci level of this range at 7521.00.
The minor retracement zone is 7373.75 to 7291.00. This zone is potential support.
Daily Technical Forecast
Based on the early price action, the direction of the June E-mini NASDAQ-100 Index the rest of the session is likely to be determined by trader reaction to the main Fibonacci level at 7521.00.
A sustained move over 7521.00 will indicate the buying is getting stronger. The daily chart shows there is room to the upside with potential targets the main top at 7641.00 and a downtrending Gann angle at 7631.50.
A sustained move under 7521.00 will signal the presence of sellers. Crossing to the weak side of the downtrending Gann angle at 7513.00 will indicate the selling is getting stronger. This could trigger a break into the main 50% level at 7440.25 and the short-term Fibonacci level at 7373.75.
This article was originally posted on FX Empire
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