NQ sold off hard soon after the open on Tuesday. A break below key upport triggered massive momentum algo sell programs, with NQ dropping more than 50 points before finding enough buyers to stall the decline.
Tuesday was a second down day in a row. Whether or not we are going to see a 3rd down day on Wednesday will depend on whether or not NQ can rally back up above key resistance.
By the end of the day NQ looks set for wave C rally up to resistance, 3875 and 3885.
Key resistance for NQ on Wednesday will be 3885.
-- A clear break above 3885 imples the pullback down has ended, and the uptrend is resuming. If so, the next upside target is a higher high above Thursday swing high.
-- Trading below Tuesday swing low is an indication NQ is still in a pullback down mode, next support is at 3830. Should 3830 breaks a strong support lies at 3800.
