NQ Guideline for Friday

With most traders out of the office on Friday for the long 4th of July weekend holiday, it will be left to the Fed to hold or push the market up.

 

With the announcement by both the Bank of England and the European Central Bank of more QE on the way, which should push the market higher, many shorts may begin to cover, which should also help push the stock market higher.

 

The Fed and other central banks may soon announces their own QE plan.

  

NQ Guideline for Thursday

The overnight buy programs continued into the regular trading hours on Wednesday and continuing all day long. Going into the long weekend, the July the 4th holiday, the buy programs is certain to continue in order to create the illusion that all is well.

 

However, the economy is deteriorating fast and the Fed is going use the Brexit referendum result as an excuse to launch QE4 to save their member banks. The launch of QE4 could have a temporary lifting effect on the stock market and is likely to cause gold price to explode to the upside.

NQ Guideline For Wednesday

A combination of profit-taking by the short-sellers and central bank buying programs rallied the market up on Tuesday, beginning with a gap-up open. No doubt there will be continual attempt to rally the stock market up again on Wednesday, however, strong selling pressure remains. NQ is now bumping against overhead resistance that is likely to attract short-selling.

 

For NQ, strong resistance resides at 4300 and 4325 where sellers would come in to sell. Unless the Fed has readied unlimited amount of capital to buy the stock market we could see NQ rallied up to 4300 - 4325 price zone then selloff from there.

 

However, a clear and sustained break above 4325 implies buyers are winning, and the next strong resistance is not until 4400.

NQ Guideline For Tuesday

After two large selloff days following the Brexit referendum, potential profit-taking by the shorts and a pause in margin selling has the potential to halt the current stock market selloff for a day or so beginning on Tuesday.

 

However, in order to do so the market needs to stay above Monday low. Any clear and sustained break below Monday low could trigger another round of liquidation selloff, next support is 4100.

 

The current selloff is just the beginning of the long overdue selloff that should last until the end of the year. Technical traders and investors would be looking for bounces to go short.

 

NQ Guideline For Monday

Massive intervention by major central banks failed to keep the global stock market from falling as global stock lost over 2 trillion dollars in market cap on Friday following the result of Brexit referendum.

 

Global deflationary forces should continue to intensify this coming week as many investors may be force to meet their margin call or be liquidated creating selling vortex and likely to continue to overrun central banks buying programs.

 

NQ has traded down to just above 4200 price level in early globex trading Sunday evening. Unless they are able to push the market up by the open on Monday margin selling is likely to kick in.

 

The next support for NQ is 4200 then 4100 likely a stronger support. 

Crash Alert - NQ Guideline For Friday

As expected on Thursday massive central banks buy programs hit the market ahead of the BREXIT referendum in order to create an illusion that all is well and triggered a massive stock market rally and tanked gold.

 

However the hope of the Remain Group faded very quickly as soon as the votes counting started, indicating the likely win for the BREXIT Group. 

 

The stock market has crashed and gold price has rocketed. Central banks is certain to intervene aggressively, buying stock and selling gold. How successful will they be remains to be seen, but be on guard for black Friday.

With central banks certain to intervene in the market on Friday, anything is possible, but 4450 would be key resistance on Friday. NQ would need to clearly break and remains above 4450 to prevent stock market crash as global deflationary pressure intensifies.

NQ Guideline For Thursday

Another sideways trading action in the market on Wednesday as buy programs continued to be sold. With the trend on the daily timeframe still pointing down, rallies will continue to be sold.

 

With the British voting on their BREXIT referendum on Thursday, and whatever the result may be, major central banks will use the results to trigger massive buy programs to push the stock market up and massive sell programs to push gold and silver down.

 

Key price level for NQ on Thursday will continue to be 4355 support and 4430 resistance.

NQ Guideline For Wednesday

Another sideways price action in the market on Tuesday as the battle between central banks and forces of deflation continues. Unless central banks are willing to dramatically increase the amount of liquidity inject into the global financial system the forces of deflation is going to win and the market should go into a sustained decline.

 

Key price levels to watch for on Wednesday is again 4435 resistance and 4355 support.

-- Remaining inside the range will keep NQ in a narrow range choppy pattern.

-- Breaking out of the range, either on a real break or a false-break is likely to cause a fast move.

 

The chart below is showing that since 2015 the stock market has not been tracking the size of central banks balance sheet, an indication that CB liquidity injection has become very ineffective in inflating the stock market.

 

NQ Guideline For Tuesday

The battle between central banks buying and the forces of deflation continued on Monday with a huge gap-up open designed to trigger buying activities was taken down by the market forces of deflation.

 

NQ has been stuck between 4435 resistance and 4355 support for the last five day. With the trend on the daily timeframe still down NQ would need to clearly break above 4500 to turn NQ back to bullish mode. Until then sellers will remain very active, selling rallies or gap-up open.

 

Inflection price level for NQ on Tuesday will be 4400, with 4435 as resistance and 4355 as support.

NQ Guideline For Monday

After a massive ramp up job on Thursday the equity market sold off hard on Friday down to retest Thursday low for NQ.

 

Overnight on Sunday night the futures market is being pushed up hard, currently trading back at around Thursday's closing price, and above 4400 price level, which is a key inflection price level on the daily chart. The hope is that the attempted summer selloff can be prevented.

 

The fight between central banks buying programs which usually occurs overnight and the market forces of deflation pushing the market down during regular trading hours is going to continue.

 

Key inflection price level for NQ on Monday will be 4400.

-- Strong selling pressure below 4400.

-- selling pressure should be under control above 4400. 

NQ Guideline For Friday

A gap-down open followed by heavy selling on Thursday morning, the day after the FOMC policy announcement, was now welcomed as massive buy programs hit the stock market and massive sell programs hit the gold market. The goal is to create an illusion that the economy is doing well, although evidence points to the contrary.

 

Key price level for NQ on Friday will be 4400.

--Above 4400 the rally should continue with the next resistance at 4430 and then 4445.

-- Trading back below 4400 is bearish, NQ may want to go back down to test Thursday low.

 

With Friday normally a choppy day we can expect a choppy narrow range sideways consolidation type of day.

NQ Guideline For Thursday

On Wednesday the equity market traded sideways ahead of the FOMC announcement, and also after the announcement as the Fed was able to hold the market up until the end of the day as the market sold off into the closing bell.

 

With no change in the Fed monetary policy (No new QE, no rate increase/decrease) the market can now go to where it should go to, which is down.

 

However, the Fed may try to hold the market up in order to create an illusion that all is well. But the forces of deflation may be to much for the Fed to bear, and sooner or later the market should start to sell off in earnest, slowly at first and then accelerate its decline in late summer and into the fall.

 

Key support for NQ on Thursday will be 4400.

-- A sustained break below 4400 is going to attract heavy selling pressure, with the next support at 4300.

-- If NQ can stay above 4400 then selling pressure should be under control. First resistance is 4430

NQ Guideline For Wednesday

The market sold off hard in early trading on Tuesday down to strong support zone at 4400 area before buy programs were able to stopped the decline and rallied NQ back up towards the high of the day.

 

On Wednesday however, anything can happen after the release of the FOMC minutes in the afternoon. Unless the Fed come up with some sorts of QE, the long awaited summer selloff could begin, so any Fed-led buy programs should be short-lived as the forces of deflation starts to overwhelm central banks buying.

 

Key price level for NQ on Wednesday before and after the FOMC announcement will be 4400.

-- Selling should be muted above 4400.

-- Selling could accelerate if NQ remains below 4400 over a period of time, next support is 4300. 

NQ Guideline For Tuesday

The equity market continued to selloff ahead of the FOMC meeting this week. NQ sold off in a narrow range choppy fashion for the second day in a row on Monday.

 

The market has priced in a NO rate raise on the next FOMC meeting, unless the Fed announces new QE program the stock market summer selloff may have just begun. If so, look for the stock market to selloff into in summer and into the end of the year.

 

On the short term timeframe, key price level for NQ going into Tuesday will be 4430.

-- Selling to continue below 4430, next support is 4400.

-- Selling should be under control above 4430.

 

A gap-down open and trend down day for NQ on Friday, dropping down to support zone at 4445 area. End of day profit-taking activities managed to pushed NQ back up into the middle of the day range.

 

With the Fed meeting scheduled for Tuesday and Wednesday look for the choppy action to continue as market forces of deflation continues to push the market down against central banks buy programs.

 

Where NQ trades tomorrow would depends on where it trades in relation to 4445 support that held up on Friday.

-- Selling activities should be under control above 4445. Resistances are 4480 and 4500.

-- Inability to stay above 4445 has the potential to trigger another round of selling programs. The next strong support is not until 4400.

NQ Guideline For Friday

Another choppy low volume narrow range day again on Thursday as the Fed continued to buy every decline in in the market in order to create the illusion that all is well. Although Friday tends to be choppy no one should be surprise if the market is pushed up ahead of the Fed meeting next week.

 

Inflection price level for NQ on Friday will be 4520, support is 4400, and resistance is 4535

NQ Guideline For Thursday

Just like Tuesday we had another choppy sideways action for NQ on Wednesday. The pattern should continue until the FOMC decision announcement at their June meeting which will be held next week.

 

The market has priced in a NO rate hike next week, so unless the Fed announces new QE program, the market should start to sell off that should last until the end of the year for the Santa Clause rally.

Gold and silver has broken out with a big gap-up open on Wednesday, perhaps an indication some insiders already knew what the Fed is going to do next week, which is, a NO rate hike during the June meeting next week, and perhaps even hinting an imminent QE4.

 

Key support for NQ on Thursday will be 4500, and resistance is 4535.

NQ Guideline For Wednesday

A choppy down day for NQ on Tuesday. The pattern should continue until the FOMC decision announcement at their June meeting which will be held next week.

 

The market has priced in a NO rate hike next week, so unless the Fed announces new QE program, the market should start to sell off that should last until the end of the year for the Santa Clause rally.

 

Key inflection price level for NQ on Wednesday will be 4520.

-- First support is 4500

-- First resistance is 4535

 

The market is in very overbought condition, as evidence by the Greed Level below, now vulnerable to sharp pullback down move.

NQ Guideline For Tuesday

On Monday, the market continued to chop sideways in a very low volume and narrow range environment as the Fed continued to hold the market up ahead of their meeting next week in order to create an illusion that all is well and that they can raise interest rate to save the little credibility that they have left.

 

Going into Tuesday, the pattern should continue with key support for Tuesday in NQ will be 4515. As long as 4515 does not get clearly violated on any down move, the choppy uptrend should continue.

 

As we can see from the chart below, there is a massive divergence between forward earnings and the S&P 500 index.

NQ Guideline For Friday

Another choppy narrow range day for NQ on Thursday, as attempted selloff day was aggressively bought by the Fed.

The buy programs should continue into the June FOMC meeting in order to create an illusion that all is ok and that they are justified to raise rates. As long as the uptrend is still alive, any selloff is an opportunity to buy the market.

NQ inflection price level on Friday will be 4515, and support is 4500, but with Friday trading action normally choppy and sideways, look for this Friday to be as usual, unless some unexpected market moving news hit the market.

The S&P 500 has now slammed up against overhead resistance (red line). We are once again within spitting distance of the all-time highs.

NQ Guideline For Thursday

Another choppy sideways action in the market on Wednesday as the only major buyer in town is the Fed itself as most traders and investors are either already long or just waiting on the sideline waiting for the shorting opportunity to come along. For now, the trend on the daily chart is up, but without much upside momentum.

 

Until we get meaningful pullback, the choppy uptrend is going to continue, as investors wait to see if the Fed in fact would raise interest rate during  their June meeting as indicated.

 

For Thursday, on a short term 5-minute timeframe, support is now 4520.

-- NQ should continue to chop it way up above 4520.

-- More sideways action below 4520, next support is 4520 then 4500.

 

Earnings are in a free-fall. EPS are back at 2012 levels, while the S&P 500 is 70% higher than then. The divergence cannot persist for too long. Sooner or later stock price will come down to reality: