NQ Guideline For Thursday

The stock market tanked hard on Wednesday from the high inflation rate as reported, due to fear that the Fed may be forced to speed up their tapering and or raise interest rates faster that planned. The CPI number was hugely unexpected, thus trigger some profit-taking selling.

On the daily chart, strong support is at the re-test or prior breakout price level, at 15,700, just 200 points below Wednesday swing high. Whether or not NQ will come down to test it before rocketing back up is difficult to predict. However, as long as NQ remains above 15,700, algos will continue to buy the dip. Breaking below 15,600 is very likely to trigger heavy selling.

Key price level to watch on Thursday is at 15,900. Trading above 15,900 is an indication NQ is in a consolidation mode with key resistance now at Wednesday swing high. For the shorts and stop-and-reverse trade congregates above 16,220. Trading below that level implies non-trending sideways consolidation.