NQ Guideline For Monday

Ahead of this week Fed meeting, it is in their interest to ramp up the stock market in order to maintain positive financial news, as so they did on Friday, as the stock market was gap-up and ramp up all day long into the close, keeping the stock market in a bullish mode on the daily chart.

 

With NQ still in a bullish mode, as long as pullback does not get out of hand, the market uptrend should continue on Monday.

 

Key support level for NQ on Monday will be 4300.

-- As long as 4300 is not clearly violated on a pullback, NQ should then resume its uptrend, with the next strong resistance at around 4400.

-- A clear and sustained break below 4300 is bearish and is an indication a larger pullback down move is in the card, first support is 4260.

NQ Guideline For Friday

With the Dow, the S&P 500 and the Nasdaq 100 all bumping against overhead resistance, currently the 200-DMA, their failure to break above resistance from the ECB stimulus on Thursday led many longs to take profit that tank the markets hard on Thursday.

 

With the daily chart still in a bullish mode, the selloff gave many the opportunity to go long. Massive buy programs managed to push the market up, and NQ managed to just below prior day close. But the indices would need to break above 200-DMA soon, as failure to do is going to attract short-sellers to come back with a vengeance.

 

On the short-term timeframe, key price level going into Thursday will be 4290.

-- Failure to break and stay above 4290 could trigger another round of sell programs, but since Friday tends to be choppy sideways type of days, it is difficult to predict whether or not tomorrow trading will be choppy trending.

- Trading above 4290 should keep short-sellers at bay, but the indices need to break above their respective 200-DMA  to keep the bears in check.

Global Liquidity Tracker

BofA Merrill Lynch's Global Liquidity Tracker, see below, fell into negative territory right as the S&P 500 peaked in 2000 and again in 2007.

 

Given that it measures liquidity conditions around the globe, it also dipped into negative territory in 2011-2012 during the height of the European debt crisis.

 

The latest data point shows that global liquidity has accelerated further into negative territory and now rests at levels we haven't seen since 2008.

NQ Guideline For Thursday

A sideways choppy narrow-range day for NQ on Wednesday with a close at the high of the day, just above Thursday key inflection price  level, 4290.

 

-- IF NQ can stay above 4290 on Thursday, it would put NQ into bullish mode, but first resistance is at 4310

-- Bearish below 4290 but 4260 will be key support for NQ on Thursday. Only a clear and sustained break below 4260 has the potential to trigger massive also sell programs.

 

With the daily timeframe still in bullish mode a sustained break above 4310 could turn the 60-minute time frame bullish, and could trigger a sharp rally.

 

Commodity Index is showing a breakout above the down-trendline and about to break above the right shoulder of the bullish inverted H&S pattern.

NQ Guideline For Wednesday

Tuesday was another down day for the equity market, with NQ down for the second consecutive days. NQ attempted to rally and pushed above 4300 key inflection price level but failed and was sold, and NQ sold off hard into the close.

 

Many algos are programmed to buy the third pullback day, and Wednesday will be the third pullback day for NQ. If so, we could see an attempted rally in the equity market on Wednesday. However, failure to rally could trigger sharp sell-off, particularly if the market continues to drift lower.

 

On the short -term time frame, key inflection price level will be 4290.

-- Selling pressure should be subdued if NQ can trade and stay above 4290. First resistance is at 4330.

-- NQ is bearish below 4290, with first support at 4265. A clear and sustained break below 4265 is likely to trigger another round of algo selling.

 

With the daily chart still bullish but the 60-minute timeframe bearish, look for NQ to remains choppy.

NQ Guideline For Tuesday

A choppy pullback down day for NQ on Monday with a close right at key support-resistance price level at 4300, setting up a rally or another down day on Tuesday, and that will depends on where NQ trades in relation of 4300 price level.

 

The 60-minute timeframe is setting up for a sharp decline. However, the daily timeframe is still in a very bullish mode.

 

Key support for NQ on Tuesday will be 4270.

-- Trading below 4270 has the potential to trigger massive algo sell programs.

-- Staying above 4270 is going to going to keep short-sellers subdued.

NQ Guideline For Monday

NQ continued to trade sideways for the third day in a row on Friday, consolidating just below strong resistance zones 4400 - 4475 area, setting up a break that could potentially trigger massive short-covering rally, or a large and sharp decline as the longs bail or get run-over by cascading selloff.

 

On the short-term timeframe, key inflection price level for trading on Monday will be 4330.

-- Bullish above 4330, first resistance is Friday swing high at 4355.

-- Bearish below 4330, with key support remains at 4300. Only a clear and or sustained break below 4300 has the potential to trigger a large and fast liquidation drop.

 

ECB will have a policy meeting this week.

NQ Guideline For Friday

The stock market traded sideways in a narrow-range consolidation pattern on Thursday, with NQ staying above its key support price level, 4300, for the second day in a row.

 

The major indices are now beginning to bump against strong overhead resistance, so the current sideways consolidation pattern may be just a setup before a break above resistance, or a consolidation before a larger pullback-down move sets in. 

 

Key inflection price level for NQ on Friday will be 4315.

-- NQ will be bullish above 4315 and the next resistance is 4400.

-- Trading below 4315 is an indication NQ is still in a pullback mode, next support is at 4300, then 4270.

 

Many top world banks are now in deep trouble, with many banks such as Deutsch Bank, is on the verge of bankruptcy. Here is a chart of Citibank

NQ Guideline for Thursday

A narrow-range sideways consolidation day for NQ on Wednesday, a day after a very large up day. A narrow rage day is a setup for a large move, either up or down, depending on where it trades in relation to key price inflection level.

 

For NQ on Thursday key price level will be 4300.

-- Staying above 4300 is an indication NQ is still in a fast move up without a larger pullback down move, next resistance is 4400.

-- Trading below 4300 implies NQ is going into a larger pullback down move, with the first support at 4270.

Guideline for Wednesday

With small traders and small speculators overly short the stock market, the released of a dismal ISM manufacturing number spooked the Fed enough to trigger one of the biggest buy programs designed to run-over stop-losses and discourage short-selling.

 

As a result, Tuesday was one of the biggest rally day in the equity market, keeping the major indices solidly in the bullish mode.

 

 Without a collapse in the crude oil market that can easily overwhelmed the Fed buy programs, the stock market should continue to rally on Wednesday, with or without a large pullback.

 

Key support for NQ on Wednesday will be 4300.

-- As long as NQ can stay above 4300, look for the rally to continue without a larger pullback down move.

-- Breaking below 4300 is an indication a larger pullback is in progress. if so the next support is at 4260-4270