Trade Guideline For Monday (Nasdaq NQ)

With a possible end to the debt ceiling charade in Washington and a possible agreement on the official increase in the debt ceiling limit, the stage is set for the Fed to push the stock market up, just to show the market that the agreement is a good thing.

Whether or not the Fed can push the market up into breakout territory only time will tell. Key breakout level in NQ is still around 2400. Below 2400 implies NQ is still inside its large trading zone between 2400 to 2200.

Key Support/Resistance for Monday is 2360.

• Bullish above 2360, targeting 2385, then 2400
• Bearish below 2360, targeting 2340,, then 2300.

Trade Guideline for Friday (NQ)

The current short-term market direction is influenced by the debt ceiling game show currently being played by the US congress. We must understand that the show must go on to show their reluctance in raising the debt ceiling in order to merely delay the inevitable collapse of the US dollar hence the US empire itself. The debt ceiling will be raised and the US dollar collapse will happen, it is just a matter of time.

It is possible, although not necessary that the US dollar would rally temporarily if congress can cut some spending. For a longer-term direction of the market I would look to the direction of the US dollar itself once the debt ceiling is agreed upon, whatever it may be.

Carry trades in the US dollar is a major influence on the direction of the equity market in general. A rally in the US dollar (appreciating dollar) is bearish for the market because it would unwind the dollar carry trades, and a further depreciation of the US dollar (weakening dollar) is bullish for the market as it would further intensify the dollar carry trades..

Until the decision is made, the market will continue to stay inside the trading range that started in February, for NQ it is between 2200 to 2400 area. For Friday's market direction I will use 2365 as key support/resistance level for Friday,

• Bullish above that level, targeting a rally to 2385, then 2400
• Bearish below it, target a decline to below Thursday's low down to 2330 - 2340 area.

Trade Guideline For Wednesday (Nasdaq NQ)

Wednesday was a strong selling day. Thursday's key level to use is Wednesday's closing price 2360. 

• Below 2360 the sell-off is likely to continue to next support 2325, then 2300.
• Above 2360 implies consolidation targeting 2380, or an up-day targeting 2400.

Trade Guideline For Wednesday (Nasdaq NQ)

Tuesday was a narrow-range consolidation day. Key price level for Wednesday is 2435.

• Below 2435 implies more consolidation or a downday on Wednesday.
• Above 2435 implies short-covering rally is going to continue, and could trigger an uptrending day.

Trade Guideline for Tuesday (NQ)

As the debate on the US debt ceiling continues, the resultant weakening of the US dollar continues to fuel the rallies in the stock and precious metal market. The rally should continue as long as the US dollar continue to tank which fuel the market.


2420 is my key Line-in-the-Sand for NQ on Tuesday. 

• Short-covering rally should continue above 2420.
• Below 2420, we could see consolidation, with first support at 2400.

Trading Guideline for Monday

The decision or no-decision on the US debt ceiling debate will determine the direction of the equity market on Monday and throughout the week. If the debate continues without any decision the short will continue to cover, with the aid of the Fed plunge Protection Team pushing the equity market up in anticipation of a potential massive selling when the decision is made.

Whether they will raise the debt ceiling or not is not important for the market as the Fed will engineer a market collapse in order to justify the initiation of QE3, whether or not they will call it QE3, it may come in under a different name.

It is now a political chess game between the Republican and the Democrat ahead of 2012 election, with both party looking to make a deal in order to claim victory. Regardless of what they will decide, they would want to collapse the market first, then to be followed by QE3. The US default and currency collapse is a mathematical certainty, but when it comes is very difficult to forecast because of the "herd mentality", and there is no way to predict when the "herd" decide to stampede out of the US dollar.


Until the decision on the US debt ceiling is imminent I will continue to look for the shorts to cover. Once the decision is made anything can happen as the Fed will engineer an agenda that they thing suits their goal of ushering QE3.

Trade Guideline for Friday (NQ)

A very bullish close on Thursday. The short-covering rally is going to intensify above 2400. Key level for Friday is 2395  to 2400 area.

• Above 2400 is bullish and short-covering rally is going to continue.
• A consolidation choppy day is expected below 2400.

Trade Guideline For Wednesday (Nasdaq NQ)

On Tuesday NQ opened gap-up above key resistance area and then triggered a short-covering rally. Key level for Wednesday is 2390.

• Above 2390 short-covering should continue and should break prior July high before pulling back.
• Below 2390 implies NQ is going into a consolidation mode, targeting 2360.

Trade Guideline for Tuesday (NQ)

Monday was another non-trending consolidation day. What NQ will do on Tuesday depends on where it trades in relation to the key level. On Tuesday key Level to watch for is 2340 area.

• Above 2340 is bullish, implies a rally move up to 2360. A sustained break above 2360 has the potential to trigger a short-covering rally that can propel price movement up to 2380 area.
• Below 2340 is bearish, implies a likely decline down to test Monday's low of 2320 area. A sustained break below 2320 may trigegr a long-covering that can tank the market down to 2300.

Trade Guideline For Monday (Nasdaq NQ)

Friday was a non-trending consolidation day. For Monday I will use 2345 as my key Line-in-the-Sand, with 2360 as resistance and 2335 as support.

• Bullish above 2345 with 2360 as the first upside target. However, a sustained break above 2360 could trigger a short-covering rally that could take price up to 2380.
• Bearish below 2345, with a decline target of 2335. A sustained break below 2335 could cause a long-covering decline down to 2315 - 2320 area. 

Trade Guideline for Friday (NQ)

Google earning report at the end of the day help pushed price up into the close. The closing price was at key breakdown level 2340 area.

• For Friday price action below 2340 area implies bearish day, targeting 2300.
• A break-back above 2340 implies an up-trending day or a choppy consolidation day targeting 2370 - 2375 area.

Trade Guideline for Thursday (NQ)

Wednesday was another consolidation day. Key level for Thursday is 2340.

• Below 2340 implies NQ is going down to 2300
• Above 2340 implies NQ is going up to 2380

Trade Guideline For Wednesday (Nasdaq NQ)

Tuesday was a consolidation day following two wide range down days. Key level to watch for on Wednesday is 2340.

• Below 2340 is bearish, implies continuation down-day on Wednesday.
• Above 2340 is bullish, implies another consolidation day or a trending up day.

Trade Guideline for Tuesday (NQ)

For Tuesday, key resistance is 2370, key support is 2360.

• Bullish bias above 2370, rally target is 2380 - 2385
• Bearish below 2360, targeting a decline down to 2330, then 2300  

Trade Guideline For Monday (Nasdaq NQ)

A consolidation with a bullish close on Friday. Key level to watch for on Monday is 2395.

• If Monday is going to be a continuation up-day, any pullback down should stay above 2395 area. If so, look for NQ to rally above prior swing high 2430 area, and if it can stay above, may trigger a short-covering rally, rocketing to the next resistance 2460.
• Below 2395 implies a pullback day on the daily chart. If so look for NQ to potentially drop down to 2360 - 2370 area.

Trade Guideline for Friday (NQ)

On Thursday the bears capitulate into the close as NQ closed at the high of the day. For Friday the key level to watch is the closing price 2416.

• Above the close is bullish, implies more short-covering to follow.
• Below the close implies consolidation, a pullback down to 2390 - 2400

Trade Guideline for Thursday (NQ)

Wednesday was a small range bullish day. Key level to watch for Thursday is 2365. 

• Above 2365 NQ should continue to crawl upwards on short-covering. 
• Below 2365 it may trigger some profit-taking by the bulls, may come down to 2330 - 2340 area.

Trade Guideline For Wednesday (Nasdaq NQ)

Tuesday was a narrow-range consolidation day. Key level to watch for on Wednesday is 2370.

• Above 2370 implies short-covering rally is resuming. A sustained break above 31-May swing high 2375 may trigger a burst of short-covering activities.
• Below 2370 implies more consolidation, targeting a move down to 2350 - 2355

Trade Guideline for Tuesday (NQ)

For Tuesday I will use 2360 as key level. 

• Above 2360 I will be looking for short-covering rally to continue.
• Below 2360 implies consolidation is likely. If so target down is 2335, then 2325