As expected, following a trending down day on Tuesday NQ traded sideways in a consolidation pattern, trading between resistance and support.
NQ rallied up to resistance in the morning then dropped down to just below support during lunch time, then rallied back up towards resistance in the afternoon a typical non-trending type of day pattern. A consolidation day is a setup for a trending move.
However, with the longer timeframe, the daily chart still in bullish mode fighting against the shorter term timeframes, the 60-min chart and the 5-minute chart currently in bearish mode, we could see a trending move, up or down in the morning, get reversed in the afternoon, simply because we have a mixed signals, a fight between the longer term daily timeframe and the short-term timeframes.
Key line-in-the-sand for NQ on Thursday will be 6690.
-- Bearish below it, selling could push NQ down to around 6580 support before it reverse (as long as the overall market does not get too bearish)
-- Bullish above it, short-covering and buying could catapult NQ up to 6800 resistance before profit-taking push it back down.
