Nasdaq Composite Technical Analysis | Forexlive

The US NFP report last Friday hasn’t changed much the
market expectations for the upcoming FOMC rate decision as the data showed a
solid labour market despite the first miss on the headline number after 14
consecutive beats. The worse part for the Fed was the average hourly earnings
ticking higher. Eventually the ultimate decision maker will be the US CPI
report this Wednesday, but we will likely need a miss in the Core CPI numbers
to see the July rate hike odds falling.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite couldn’t break above the high on a second try and pulled back again
into the red 21 moving average. We
might now see an ascending triangle forming
with the moving average acting as dynamic support. So, if the price breaks
below the moving average, then we will likely see a selloff into the 13174 support.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see more closely the
key levels for the Nasdaq Composite. The buyers will need to break above the
13855 high to regain control and take the price towards the 14649 level. The
sellers are trying to position for a pullback into the 13174 support first and
upon a break lower, target the 12274 level.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
buyers tried to break out on the second try but failed as the price fell below
the trendline that
was supporting the momentum. We then got a brief rally out of the NFP report,
but eventually the market gave it all back as the focus switched to the US CPI
report on Wednesday. From a risk management perspective, the buyers would be
better off buying from the 13174 support where we can also find the trendline
and the 38.2% Fibonacci
retracement level for confluence.

Upcoming
Events

This week all eyes will be on the US CPI report on
Wednesday. Higher than expected figures, especially on the core readings,
should be negative for the Nasdaq Composite as the market will price in a more
hawkish Fed and possibly a worse recession afterwards. On the other hand, lower
than expected readings should lead to a rally as the market will price out the hawkishness
and price in rate cuts and a soft-landing scenario. We finish the week with the
US Jobless Claims on Thursday and the University of Michigan Consumer Sentiment
on Friday.