Nasdaq 100 - Eyes on the FED
Updated
Recently, we warned about the impending short-term bounce in the price of QQQ while sticking to our bearish outlook for the medium and long term. Today, we will pay close attention to the Nasdaq 100 index as the FED officials are expected to hike interest rates in the range of 50bps to 75bps. In our opinion, such a move by the central bank will negatively impact the U.S. economy. Higher servicing cost of debt, high rate of inflation, the prospect of global recession, and more economic tightening by central bankers will further weaken the slowing economy.
As a result, we are increasingly anxious about the current rally. At the moment, we will pay close attention to the immediate support/resistance with the bullish potential above it and the bearish potential below it. Additionally, we will monitor volume to see if it is sufficient to propel the price higher. For the bullish prospect, we would like to see a further increase in price accompanied by a gradual increase in volume.
We introduce the current trade setup in Illustration 1.01. It consists of two alternative scenarios. We will update the idea after the FED meeting.
Technical analysis - daily time frame
RSI and Stochastic are bearish. MACD is neutral. DM+ and DM- are neutral. Overall, the daily time frame is slightly bearish.
Illustration 1.01
Illustration 1.01 shows the current trade setup for the Nasdaq 100 index (continuous futures, NQ1!).
Technical analysis - weekly time frame
RSI is bullish. MACD is neutral. Stochastic points to the upside but stays in the bearish area. DM+ and DM- remain bearish. Overall, the weekly time frame is slightly 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 be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
As a result, we are increasingly anxious about the current rally. At the moment, we will pay close attention to the immediate support/resistance with the bullish potential above it and the bearish potential below it. Additionally, we will monitor volume to see if it is sufficient to propel the price higher. For the bullish prospect, we would like to see a further increase in price accompanied by a gradual increase in volume.
We introduce the current trade setup in Illustration 1.01. It consists of two alternative scenarios. We will update the idea after the FED meeting.
Technical analysis - daily time frame
RSI and Stochastic are bearish. MACD is neutral. DM+ and DM- are neutral. Overall, the daily time frame is slightly bearish.
Illustration 1.01
Illustration 1.01 shows the current trade setup for the Nasdaq 100 index (continuous futures, NQ1!).
Technical analysis - weekly time frame
RSI is bullish. MACD is neutral. Stochastic points to the upside but stays in the bearish area. DM+ and DM- remain bearish. Overall, the weekly time frame is slightly 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 be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
Trade active
Idea was updated in the following post: 
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