Monday was the 3rd very large down day in a row for NQ, an indication that the sell-off is impulsive, with markets collapsing worldwide. Australia experience their 2nd flash crash on Monday, Japan and New Zealand had their flash crash a few weeks ago, North American market is not immune to it.
On Monday we saw an early morning sell-off that was reversed sharply, likely by the Fed buyers, that was again sold in the afternoon, with the market again closing at the day low, an indication that the buyers capitulated into the close, a characteristics of forced margin selling.
Key resistance for NQ on Tuesday is 3850.
-- Inability to break and stay above 3850 is going to attack more selling, with the next target down at 3785. If that support does not hold stronger support lies at 3700 - 3730.
-- Breaking and staying above 3850 target the next resistance at 3900.
