Following a huge down day on Monday, NQ traded sideways in a consolidation pattern on Tuesday. NQ could go either way on Wednesday, either continuing to consolidate for another day or resume the downtrend, and the direction of the move will be based on where NQ trades in relation to key price level.
Key price level for NQ on Wednesday will be Monday swing low at 4430, and 4430 area is the 200-DMA for NQ on the daily chart, a strong support zone.
-- A clear break could unleash an avalanche of algo sell programs. The next major support for NQ will be 4100. Whether or not NQ can drop down there in one day it is impossible to predict.
-- Trading above 4430 will keep selling pressure in check. Resistance are at 4500, 4580 and 4600.
