NQ traded sideways inside prior day range all day on Monday, with a bearish close, and it was an "inside" day.
An inside day is an excellent setup for a breakout day as stop-losses tends to congregate above and below the trading range. A sustained break out of the range should produce a fast and large trending move in the direction of the break
All major stock market indices, including NQ, S&P 500, Dow, remains in crash mode as of Monday closing, and Tuesday could be the day the sell-off resumes, .
The breakout is likely to the downside as both Nasdaq 100 futures contract (NQ) and S&P 500 Futures contract ES closed below their respective 200-dma daily, a very bearish setup. Dow close right at its 200-dma daily, thus if Dow break below its 200-dma daily the sell-off should be fast and large.
For NQ, key trading range to break is 7040 - 7200.
-- 7040 is critical support for NQ on Tuesday as stop-loss congregates below it. A break below 7040 will start to run-over the stop-losses, triggering an avalanche of selling.
-- If the PPT is able to cause a rally above 7200, and run-over trailing stop-losses, we could see a fast and large rally. with resistances at 7300 and 7445 (prior low now resistance)
