Nasdaq Composite Technical Analysis | Forexlive

Yesterday was another day of choppiness for the Nasdaq
Composite with an initial spike higher following less hawkish comments from Fed’s Waller where he
said that there were good arguments that if inflation continued falling for
several more months they could lower the policy rate. The gains got erased soon
after though as the labour market details in the US Consumer Confidence report
could have been the reason for caution, especially since we are approaching
some key economic releases before the FOMC rate decision on the 13^th
of December.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq Composite
continues to consolidate maintaining a bullish tilt into the cycle high at
14446. We might start to see some profit taking around these levels which could
finally provide a decent pullback. We can also expect the sellers to step in
around these levels with a defined risk above the cycle high to position for
new lows.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the price has
been diverging with the
MACD recently
which is generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, it might be a hint that we could indeed see at least a
pullback soon. From a risk to reward perspective, the buyers would have a much
better setup around the 13700 support where we
can also find the confluence with the
38.2% Fibonacci retracement level of
the entire rally.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
price has been diverging with the MACD since the breakout of the key trendline around
the 13700 level. The price recently broke below the lower bound of the rising
channel which increases the odds of a pullback, although one last spike into
the cycle high cannot be ruled out. The sellers are likely to start piling in
targeting first the swing low at 14000 and upon a further break lower, look for
the support at 13700. The buyers, on the other hand, should use those support
levels to position for a resumption of the uptrend.

Upcoming
Events

Tomorrow we will get the US PCE and US Jobless Claims
data with the market likely focusing more on the latter given that we already
saw the latest inflation data with the US CPI report just two weeks ago. On
Friday, we conclude the week with the US ISM Manufacturing PMI which missed
expectations by a big margin the last time.