Guideline For Tuesday

On Monday, a large gap-down opening was immediately bought triggering a short-covering rally that pushed NQ back into the prior established trading range 3200 - 3240. 

For Tuesday it should continue to stay inside the range, with either a morning rally up to resistance or a gap-up open into resistance, before dropping back down to the middle of the range, unless of course the government shutdown can cause it to get out of the range.

For Tuesday key level to watch for is 3220 mid-point of the trading range.

-- Above 3220 is an indication NQ is going up to the 3240 resistance zone before pulling back down towards 3220 area.

-- Below 3220 implies it is going back down to 3200 support.

Keep in mind that the US government shutdown can have a major unexpected impact on the markets as the algo traders are going to be active.

Guideline For Monday - NQ

NQ continued to trade sideways between 3200 support and 3240 resistance, with 3220 as the middle (inflection) point. 

With the fiscal cliff debate still ongoing, I would suspect NQ would continue to trade inside the range, unless of course, some large insider fund has the information not available to the public. If not, NQ should continue to trade sideways. 

For December ES (S&P 500 futures) it continue to trade sideways inside the range between 1682 support and 1700 resistance.

Guideline For Friday -- NQ

Another sideways consolidation day on Thursday, trading mostly between 3215 and 3235 as investors wait for the fiscal cliff negotiations to end. 

I am looking for more of the same for Friday, with support at 3220 & 3200 and resistance at 3240 & 3255.

Thursday's Guideline

Another sideways trading range again, the 4th in a row on Wednesday, with the algo traders still controlling price actions, keeping the market in a narrow trading range until the fiscal cliff negotiation is settled.

For Thursday key resistance is 3220, support is 3200.

-- NQ can continue to stay inside the 3200-3220 trading range -- with a false-breakout of the range.

-- A sustained break above 3220 will target a move up to the higher resistance levels of 3230 and 3240. 

-- A sustained break below 3200 will target a move down to the lower support levels 3188 and 3180

As long as the algos are still in control, support will be bought and resistance will be sold. 

 

Guideline For Trading NQ on Wednesday

Another choppy sideways action for NQ on Tuesday, as the market is clearly being controlled by computer algos, pushing the market up and down inside a narrow trading range  ahead of the decision on the debt ceiling. If the algos continues to rule the market, look for the market to continue trading sideways.

But at the end of the day on Tuesday NQ looks ready for a big decline to the next support level, 3200 and possibly to key support zone at  3187 area, with or without a gap-down open, as long as it can stay below 3225 key resistance area.

Staying above 3225, however, clearly negates the bearish setup, implies it is going to re-test last Friday swing high.

Guideline For Tuesday

On Monday, NQ opened with a gap-up, but quickly collapsed, crashed down through the gap-close. As a consequence, turned into a bearish morning. It then consolidated sideways the whole afternoon, closing below key resistance, 3220, which will also serve as key resistance for Tuesday trading.

At the close on Monday, NQ looks ready to tank back down to lower low, below Monday morning low, down to the next crucial support level at 3187 area. It may or may continue down on Tuesday depending on where it trades in relation to the key level of 3220

-- Above 3220 implies NQ is going back up to either retest last Friday swing high, or breaking above last Friday high.

-- Below 3220 implies NQ is going to re-test or break below Monday's swing low.

Fiscal Cliff deal..

Guideline For Monday

The question on traders and investors mind ahead of the FOMC meeting announcement last week Wednesday was whether or not the Fed is going to tapper - and we had the answer to the question - the Fed is not going to taper their $85 billion monthly asset purchases.

Risk-On Trades -- the US$ Carry Trades, was back on again, with hot money going back into risky assets again. 

Hot money going out away from the US and into emerging markets and currencies has the potential to cause the US stock markets to go into a pullback-down mode for a while, if the major stock indices are not able to maintain the current upside momentum. 

As the US economy will go back into recession next year 2014, the Fed would have to increase the amount of their monthly asset purchases by the middle of next year. For now the debt ceiling debate should occupy the financial new for a while.

Key price level for NQ going into Monday trading session is 3220-3225 area. For S&P 500, key level for Monday is around 1700

--  Above 3220 for NQ and above 1700 for S&P implies the market has a bullish bias, looking for rally back up to test the recent high.

-- Below key level is bearish, could tank the market down to the next support, 3200 for NQ and 1680 for S&P.

Guideline For Friday

Nasdaq consolidated sideways on Thursday inside a very narrow trading range following a sharp and large rally on Wednesday after the FOMC announcement of NO tapering.

Daily trend is up but it may be ready for some kind of a pullback down to support in the morning before rallying back up. Friday is usually a range-bound day, the morning trend will depends on where it trades soon after the open in relation to its key price level.

Key price level for Friday is 3231.

-- Above 3231 has a bullish bias with the upside target at 3250 - 3260, as long as it can break and stay above Thursday swing high.

-- Bearish bias below 3231 with downside target at 3200.

Guideline For Thursday

NO Tapering on the QE, implies QE forever. The Fed has NO way out. The markets, equities, Bond, Gold all rocketed following the announcement. 

The uptrend should continue until it has exhausted all the buying pressure both from short-covering and buying from cash still on the sideline. Having said that, we must watch key level going forward. Though not expected, breaking back below the key level implies it is reversing trend

Key Level For NQ going forward is 3185.

-- Above 3185 implies the uptrend is to continue to the next upside target, which is 3250.

Trade Guideline For Wednesday

On Wednesday, the market should finally get clarity on issue that traders and investors has been waiting for for since May 2013: the how and when the Federal Reserve is going to adjust its monetary policy, to taper or not to taper.

Whether or not they will taper, only time will tell, and the time is tomorrow, Wednesday afternoon at 2:00 PM eastern time. The reaction from the announcement could cause a trending move, up or down, until the next issue comes around -- the US debt ceiling due in October, and then of course the selection of the next Fed Chairman/woman.

With Larry Summers, who positioned himself as less money-printing crazy that Ben Bernanke, pulling out of the race for the next Fed Chairman, the hope is that Janet Yellin, the ultra money printer, should keep the bull market in stocks alive. We shall see what will happen going forward, but the debt ceiling debate plus the race for the next Fed Chairperson should keep market volatility high.

For Wednesday, first support on the daily chart for NQ is 3140 area.

-- Above 3140 is an indication NQ is going to continue to go higher.

-- Below 3140 implies it is going down to 3020 - 3040 strong support zone.

NQ Daily Chart

ES Daily Chart; Key support is 1660-1680

Guideline For Tuesday - NQ

The Fed's massive buying binge during globex trading session on Sunday night was immediately sold off right from the opening bell, and all day into the close. On the 5-minute chart NQ is now in sell mode going into the close, although at the end of the day the market seems ready to pullback up.

Key Resistance is now 3175. 

-- NQ would need a sustained break above 3175 to turn it back into rally mode.

-- Below 3175 implies it is still in sell mode with the next support at 3150 and 3140

The Fed announcement on Wednesday is going to be closely watch by market participants. What everyone is waiting to see is whether or not the fed is going to taper their bond purchases. if it does, by how much.  

Guideline For Monday -- NQ

The equity futures market opened the globex trading session with a large gap-up following the news that Larry Summers has withdrawn his application for the next Fed chairman. That makes Janet Yellin, the ultra money-printer, the prime candidate for the next Fed Chairman.

Whether or not the regular trading session will open with a big gap only time will tell, but janet Yelling's appointment should send shock wave to those holding short position in the equity market, and could trigger a capitulation move up to exhaust the current uptrend making a short term top, then pulling back down before reversing back up for the annual Christmas rally.

Key level for Monday is 3175 as support and 3200 as resistance.

-- Above 3200 should trigger more short-covering, may reach the next target 3250.

-- Below 3200 implies NQ is pulling back down to 3275..

Guideline For NQ

Another sideways consolidation for NQ on Thursday, and it may be ready to make a trending move on Friday, either up to 3200 or down to 3150 depending on where it trades in relation to equilibrium level, which is 3175 for Friday.

-- Above 3175 would give NQ a positive bullish bias for Friday morning, with rally target up to 3200.

-- Below 3175 is an indication that it is puling back down to support, 3150

NQ Guideline For Thursday

NQ opened with a gap-down dragged down by Apple shares (AAPL), but the general market were generally bullish following the postponement of US military strike on Syria, dragging NQ up towards gap-closed.

Key price level for NQ on Thursday morning is 3175.

-- Above 2175 should continue to trigger short-covering rally, with the next target at 3200.

-- Below 3175 implies NQ is going into a consolidation mode, with the next support at 3150.

NQ Guideline For Wednesday

US military strike on Syria has been put on hold,at least for now due to overwhelming opposition by the american people, but the government will certainly be looking for another excuse to strike because the goal is to strike Syria, by hook or by crook, but for now, it has been put on hold.

The strike delay has given a boost to the equity market as the rally continues, and it should continue with pullbacks along the way, unless the US can find another good reason to strike. 

Key Level For NQ on Wednesday is 3190.

-- Short-covering to continue above 3190, next resistance zone is 3200.

-- Below 3190 implies NQ is going into apullback mode with support at 3168

Guideline For Tuesday

NQ quickly rallied above resistance on Monday morning, then stayed above resistance, triggering a short-covering rally that lasted all day.

The daily trend for NQ is currently up, with the next target at 3200, with the larger target at 3250 but whether or not it will rally up to 3200 right away in the morning will depend on where it opens and trades soon after open.

Key level for NQ on Tuesday is 3165.

-- Above 2165 will target a move up to 3200.

-- Below 3165 implies NQ is going to consolidate, with support at 3150

The US ongoing plan to strike Syria will greatly influence market movements on Tuesday as Obama is scheduled to give his speech on at 9 PM eastern. What he will say is going to rally or tank the market.

Monday's Guideline - NQ

NQ closed in the middle of Friday's trading range, right at the equilibrium level. The direction of the morning trend will depends on where it opens and trades in relation to the equilibrium level soon after the open.

Equilibrium Level is 3130, 

-- Resistance is 3150,  

-- Support is 3100.

-- Trading Range = 3100 - 3150.

It would need a clear and sustained break out of the range to trigger a trending move in the direction of the break. If not, it will breakout and reverse.

US strikes on Syria will continue to strongly influence the market.

NQ Guideline For Friday

A narrow-range consolidation trading pattern on Thursday, and it is likely setting up for a trending move on Friday, usually occurring in the morning, and the direction of the move will depends on where it trades soon after the open.

Key equilibrium price level for Friday is 3130, resistance 3145, support 3115.

Guideline For NQ on Thursday

After closing the opening gap, and with Obama's military strike on Syria put on hold, at least for now, caused the short-sellers to cover, trigegring s short-covering rally all day and into the close.

For Thursday, key level to watch for is 2125.

Any major change in the US policy regarding a military strike against Syria could change the market dynamics very quickly. But should there be no change, the market should continue to rally, as long as it can stay above 2125, as the shorts will continue to cover.
--  However, below 2125 implies NQ needs a consolidation before the next trending move.

Wednesday Guideline For NQ

Nasdaq opened with a gap-up on Tuesday and then after spending about 1.5 hours trading in a very narrow range, NQ tank following Obama's speech regarding military strike on Syria. It dropped slightly below gap-close before rallying back up into the close.

On Wednesday key level to watch for is 3095 area.

-- Above 3095 implies potential rally to break above Tuesday's swing high, with the next resistance at 3120. It would need a massive Fed-induced short-covering rally to clearly break above 3120.

-- Below 3095 implies NQ is going down to support at 3070. It would need a strong selling pressure to clearly break below 3070, but if it does, next support is 3045.

Tuesday Guideline For NQ

With the US determined to attack Syria the market is certain to be volatile going forward.

Key price level (support/resistance) for NQ on Tuesday is 3085. 

-- Bullish above with resistance at 3110.

-- Bearish below, with support at 3050