On Monday, NQ traded sideways, slightly to the bullish side, ahead of the FOMC policy decision announcement on Wednesday, still unable to clearly breakout above 4040 key resistance zone.
Whether or not it would breakout before the FOMC announcement on Wednesday, only time will tell, but the momentum of the current rally is slowing down, and it could be a setup for the next breakout to the upside or a prelude to a larger pullback down, so going forward the key price level is still 4040.
The Fed would likely be ready with major buy programs after their policy announcement, in which case the market would spike higher breaking above breakout level, unless of course their buy programs get overwhelmed by the sellers.
Cycle high on the daily chart will be on Thursday October 30th this week, the day after the FOMC announcement, and it could produce a spike high followed by a fast reversal down. Failure to produce a reversal is bullish, and could produce a sustained fast move to the upside.
Key price level remains 4040.
-- A sustained breakout above 4040 could trigger short-covering rally targeting a test or a break of the 4115 swing high on the daily chart.
-- Failure to break and stay above 4040 could attract short-selling, supports are 4020, 4000, 3980, 3940
