Massive buying binge in the equity futures market on Sunday night that led to a huge gap-up open on Monday failed to trigger a short-covering rally as reality quickly sets in soon after the open as sellers started to sell both the equity market and the crude oil market.
NQ dropped over 90 points from the early morning high before bouncing back up, but afternoon selloff dropped NQ back down to near the day low, setting up another bearish day or a pullback-up day, depending on where NQ trades soon after the open.
Key inflection price level for NQ on Tuesday will be 4165.
-- Above 4165 is an indication NQ may either trade sideways or trade upward to re-test key resistance level 4185. Failure to clearly break 4185 could attract seller that could tank NQ back down to lower low below Monday's swing low. NQ would need to clearly break above 4185 to trigger short-covering rally, higher resistance are 4200 and 4215
-- Bearish below 4165, but NQ needs to clearly break below Monday's swing low to trigger another round of liquidation sell-off, next support is at 4100.
