NAS100 Outlook for the Week (October 21-28, 2024) Key Concepts:
Wyckoff Phases and Distribution:
The chart seems to follow the Wyckoff methodology, particularly focusing on Distribution phases (Phase A, B, C).
The current price action appears to be in Phase C, approaching the potential markdown (downtrend) continuation.
Supply and Demand Zones:
A Bearish Order Block is identified at the upper part of the chart, indicating an area where institutional sellers are present. Price action is likely to be rejected here, pushing prices lower.
There is also a Buy Side Liquidity zone that was previously mitigated and failed to push price higher, confirming further bearish momentum.
Elliott Wave Analysis:
We can see an Elliott Wave structure forming, with a Wave 3 completion in progress. Wave 4 is expected to be corrective (minor upward retracement), followed by Wave 5 (continuation of the downtrend).
The labeling of the waves implies that next week's price action is entering Wave 5, which will likely bring prices lower towards the 2.618 extension levels seen on the chart.
Liquidity and Smart Money Concepts:
Liquidity Sells Below Wave 2: Retail traders' stop losses are marked below the previous Wave 2 low. Smart money will likely target this liquidity zone to push price lower.
SOW in Phase B (Sign of Weakness): The chart shows a SOW (Sign of Weakness), confirming a bearish trend during Phase B. Prices are likely to continue lower as market participants distribute their holdings.
Market Structure and Break of Structure (BOS):
The chart highlights CHoCH (Change of Character) and BOS (Break of Structure) events. These represent moments where the market shifted from bullish to bearish structure, signaling a downtrend.
There’s a CHoCH in Phase B, leading to MSB (Market Structure Break), confirming a further decline.
Fibonacci Levels:
The Premium and Discount levels marked on the chart indicate the range where price is likely to react.
Prices rejected from the 0.705 retracement level, confirming a bearish continuation towards the Discount range (below 20,000 level).
Outlook for Next Week:
Monday:
Expect a continuation of the bearish move, possibly targeting the current weak low around 19,640.
Early in the week, we might see minor retracement into the Wave 4 correction, but this is expected to be short-lived.
Tuesday - Wednesday:
Market could test the Bearish Order Block or the Premium level again before moving lower.
Watch for a Break of Structure (BOS) around the 19,910 level. If this level holds, a strong push down into the lower liquidity zones is likely.
Thursday - Friday:
Wave 5 should start its completion phase, driving price further down towards the 19,131.8 and 19,210.3 levels.
This would be in line with the 2.618 Fibonacci extension, where we can expect significant support or a reversal if market conditions change.
Key Levels:
Bearish targets for next week: 19,210.3 (2.618 extension), 19,131.8 (2.786 extension).
Support areas to watch for potential reactions: 20,042 and 19,640.
