NQ traded sideways in a choppy manner on Monday, unable to get much rally traction, likely setting up for a large pullback down move.
On the 60-minute chart, NQ rally is now in its fifth way up from September 29 low, and is now in overbought territory. And once wave 5 rally has ended, we can expect a larger NQ pullback down move.
Key price level for NQ on Tuesday will be 4360 support.
-- Trading below 4360 support is an indication that wave 5 rally has ended and the start of a larger decline is in progress. If so the first downside target for NQ is 4250 area. First NQ support is 4320, and has the potential to cause a temporary bounce.
-- Any decline that cannot clearly break below 4360 implies wave 5 rally is still alive and still in progress, next resistance is at 4400 then 4430.
