Nasdaq Composite Technical Analysis | Forexlive

Yesterday, the Nasdaq Composite broke through the
cycle high following the US CPI data
where all the figures came in line with expectations despite some fears of
higher numbers. The market is going all-in on the soft-landing trade with the
Nasdaq Composite now eyeing the all-time high. There’s a high risk of a
pullback today though as the Fed could push hard against rate cuts
expectations. In fact, the Dot Plot will be the focus of market participants
with more than two rate cuts pencilled for 2024 signalling a dovish leaning, while
less than two hinting to a more hawkish stance.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq Composite
yesterday broke through the cycle high as the US CPI came in line with
expectations dissipating some fears about higher figures. Technically, there’s
not much in the way until the all-time highs now except a swing high from March
2022 at 14646.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the breakout
above the cycle high is diverging with the
MACD. This is
generally a sign of weakening momentum often followed by pullbacks or
reversals. This is a sign for caution, especially given the FOMC rate decision
today where the Fed might push hard against rate cuts expectations.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the breakout from yesterday and from a risk management perspective, the
buyers would be better off waiting for a pullback into the 14450 resistance now
turned support to position for further upside. The
sellers, on the other hand, will want to see the price breaking below the 14450
level to pile in and target a drop into the 14050 support.

Upcoming
Events

Today we have the US PPI data followed by the FOMC
rate decision where the Fed is expected to keep interest rates unchanged. Tomorrow,
we will see the latest US Retail Sales and Jobless Claims figures, while on
Friday we conclude the week with the US PMIs.