E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Potentially Bearish Divergence from Dow and S&P 500

James Hyerczyk

December E-mini NASDAQ-100 Index futures are trading lower shortly before the cash market after giving up earlier gains. The index is also diverging from the Dow and the S&P 500 Index, which is a potentially bearish sign for technology stocks.

The catalyst behind the weakness is a report that leaders of the House Judiciary Committee requested documents from Amazon, Apple, Facebook and Google parent company Alphabet as part of their on-going antitrust investigation against Big Tech. Earlier in the week, attorneys general from 50 states and territories ramped up their investigations into the matter.

Perhaps limiting losses is an easing of tensions over U.S.-China trade relations.

At 13:30 GMT, December E-mini NASDAQ-100 Index futures are trading 7915.00, down 27.50 or -0.34%.

Daily December E-mini NASDAQ-100 Index

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through 8002.50 will signal a resumption of the uptrend. The main trend will change to down on a trade through 7764.00.

The short-term range is 7764.00 to 8002.50. Its 50% level or pivot at 7883.25 is potential support.

The main range is 7390.00 to 8002.50. If the main trend changes to down then its retracement zone at 7696.25 to 7624.00 will become the next downside target.

Daily Technical Forecast

Based on the early price action and the current price at 7915.00, the direction of the December E-mini NASDAQ-100 Index the rest of the session on Friday is likely to be determined by trader reaction to the downtrending Gann angle at 7927.75.

Bearish Scenario

A sustained move under 7927.75 will indicate the presence of sellers. If this creates enough downside momentum then look for the selling to possibly extend into the pivot at 7883.25, followed closely by the uptrend Gann angle at 7860.00. Since the main trend is up, buyers are likely to come in on a test of this angle.

If 7860.00 fails as support then look for the selling to possibly extend into a pair of uptrending Gann angles at 7812.00 and 7806.00.

Bullish Scenario

A sustained mover over 7927.75 will signal the presence of buyers. This could lead to a retest of the steep uptrending Gann angle at 7956.00. Overcoming this angle will indicate the buying is getting stronger. This could trigger a rally into a downtrending Gann angle at 7999.75, followed closely by the minor top at 8002.50.

The trigger point for an acceleration to the upside is 8002.50. This is the last potential resistance before the 8071.75 main top.

This article was originally posted on FX Empire