Trade Guideline For Tuesday

NQ continued to rally / pullback up on Monday, up to just below strong resistance 2785-2790 area at the close. Unless NQ can clearly break above resistance, and then stay above resistance it is likely to pullback down to support on Tuesday. 

If so, and as long as 2770 support is not clearly violated, it should then continue to rally back up to try to break resistance.

A clear break below 2770 implies NQ is ready to trend back down, with supports at 2755 then 2740. 

The market is clearly topping with Nasdaq leading the way down.  Clear divergence between Dow and other markets (Charts from Elliott wave Int)

Trade Guideline For Monday in NQ

Worse than expected employment report released before the market opened on Friday resulted in a big gap-down open. Buy programs kicked-in immediately right from he opening bell, which resulted in ABC wave pullback up, with the low-risk wave B pullback buy entry opportunity between 1.30 to 2.30 pm eastern time.

Whether or not we would get a follow-through selling on Monday only time will tell, and will be based on price action in relation to NQ's key support/resistance equilibrium level at 2750 area.

Key Level For Monday is 2750.

-- Above 2750, look for NQ to try to close the gap from Friday's open.

-- Below 2750 look for NQ to try to resume its downtrend, with key support at Friday's swing low.

Trade Guideline For Friday

Wave 5 down finally ended with a cross above the band during the lunch hour, wave 1 or A.

-- As long as price remains above the band on Friday the rally that started during the lunch hour on Thursday should continue.

-- A break-back below the band implies the end of the rally leg, whether it is an ABC wave or 1-2-3-4-5 wave.

NQ Intraday Update on 5-Minute Chart

NQ attempted rally soon after the open produced a small but invalid penetration above the band, stopped just below FT Pivot resistance. It quickly dropped down impulsively, on subwave wave 1 of 5, down to S1 support and 2770-2775 prior resistance now support (see 60-minute chart February 8 to February 20 highs).

 A clear break above the band that is followed by a choppy pullback down to the band confirms wave 5 down has ended and that wave A or 1 up is in progress, first target is the FT Pivot resistance.

Below the band implies wave 5 down is still in progress, next downside target is 2755 prior swing low.

NQ Trading Guideline For Thursday

Wednesday was a down-day for NQ with the opening near the day high with the close near the day low. Whether or not the Wednesday's decline has ended we have to wait for Thursday.

Key Level For Thursday is 2792.50 area.

-- A break above 2792.50 area implies Tuesday's-Wednesday decline leg 1-2-3-4-5 has ended. If so, it should be followed by a pullback up, in the form of ABC Wave pattern or 1-2-3-4-5 wave pattern., with the first set of resistance at 2805-2810.

-- Below 2792.50 implies more decline to follow, with the next support at 2770, then 2755

NQ 5-Minute Chart

Intraday 5-Minute NQ Chart

This morning open was a wave B pullback sell at the open. 

The current downleg is either wave C or 3, once completed should break-back above TD proprietary band. A break-back above the TD proprietary band confirms the end of the current downleg, and will set up a pullback wave B buy.

Trade Guideline For Wednesday

Nasdaq continued to rally, making another new higher high on Tuesday, in a snail pace. Support for Wednesday is 2805.

Above 2805 implies Tuesday's afternoon pullback has ended, and NQ should make another higher high. Below 2805 implies pullback is still in progress withe the next support at 2795, and then 2785.

Cyprus Finance Minister Resigned

BIS is coordinating plans to expropriate bank depositors

Expropriating large depositors at troublesome banks is now international policy coordinated by the Bank for International Settlements, GoldMoney's Alasdair Macleod writes today, and while distribution of one's deposits to preserve coverage by government deposit insurance may provide some protection, in the end any wealth held in the international banking system is vulnerable.

"That the BIS feels it has been necessary to co-ordinate G20 nations into a common approach to bank rescues using uninsured non-monetary and financial institutions' deposits is evidence that bank failures capable of threatening the global financial system are definitely an ongoing risk,"

S&P 500 E-Mini Chart (ES)

S&P 500 is still solidly in an uptrend on the daily chart. As long as price remains above the band (see chart below), the better trades are to buy pullbacks. 

However, it is in wave 5 up from the November 2012 swing low. Once completed it should reverse and tank hard. The 2 prior tops, April 2012 and September 2012 requires a re-test of the high before before it tanked.

ES Current Daily Chart

NQ Daily Chart

NQ is in its final leg up, W5, of the current uptrend that started in November 2012. Whether or not it will break above prior swing high, September 2012, only time will tell. If it does break, targets are 2925 and 2950.

As long as price action remains above the band, the trend is still up, and the trade will remain buying the pullbacks.

NQ daily Chart

Trade Guideline For Tuesday in NQ

On Monday, NQ opened above broken resistance but failed to stay above, implies it was going to drop back down towards support around 2775-2780, which it did, bouncing off just above support for end of day profit-taking activities, stopping right at key inflection point 2792.

On Tuesday, Key Line-in-the-Sand  POC is 2792.

-- Staying below 2792 implies further decline, with the next support is at 2775. Failure to rally from 2775 is a clear indication that it is going to drop down further to the next support level which is at 2755 area.

-- Trading above 2792 implies NQ is trying to re-test 2810 resistance again. Whether or not is is going to re-break above 2810 and then rally further to 2830, only time will tell.