Nasdaq 100 - The FOMC threatens further rise of NQ1!
Updated
Over the past week, the Nasdaq 100 index has been choppy. Meanwhile, the volatility has dropped and many analysts rushed to call the bottom for the stock market. We repeated several times that we do not believe this bullish narrative. Instead, we expressed our belief in the short-lived “bear market rally”. We still maintain this notion and expect the market to continue lower. Therefore, we would like to set a price target for NQ1! to 12 500 USD and 12 250 USD.
Fundamental factors
We expect the FED to raise interest rates next week, which in turn will put more pressure on the economy. At the same time, we expect economic tightening to further deteriorate the economic situation. As a result, we are bearish on the Nasdaq 100 index and the U.S. economy.
Illustration 1.01
Illustration 1.01 shows the daily chart of NQ1!. The choppy price action occurs mostly within the neutral zone. We anticipate a breakout to the downside.
Technical analysis - daily time frame
RSI is neutral. The same applies to MACD. Stochastic oscillates in the bullish area. DM+ and DM- produce whipsaws. ADX suggests the trend is turning neutral. Overall, the daily time frame is neutral.
Illustration 1.02
The picture above shows a series of false breakouts above the hourly downward sloping channel.
Technical analysis - weekly time frame
RSI, MACD, Stochastic, DM+, and DM- are all bearish. Overall, the weekly time frame is bearish.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
Fundamental factors
We expect the FED to raise interest rates next week, which in turn will put more pressure on the economy. At the same time, we expect economic tightening to further deteriorate the economic situation. As a result, we are bearish on the Nasdaq 100 index and the U.S. economy.
Illustration 1.01
Illustration 1.01 shows the daily chart of NQ1!. The choppy price action occurs mostly within the neutral zone. We anticipate a breakout to the downside.
Technical analysis - daily time frame
RSI is neutral. The same applies to MACD. Stochastic oscillates in the bullish area. DM+ and DM- produce whipsaws. ADX suggests the trend is turning neutral. Overall, the daily time frame is neutral.
Illustration 1.02
The picture above shows a series of false breakouts above the hourly downward sloping channel.
Technical analysis - weekly time frame
RSI, MACD, Stochastic, DM+, and DM- are all bearish. Overall, the weekly time frame is bearish.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
Trade closed: target reached
Our price target of 12 500 USD was reached.
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