NQ Guideline For Wednesday

With the FOMC releasing its policy statement on Wednesday afternoon anything could happen but it is certain that the Fed is going to continue to trigger non-stop buy programs again. Whether or not they could overcome intense deflationary selling if they in fact raise interest rates on Wednesday, only time will tell.

The bond market continued on sold off on Tuesday, and Chinese Yuan continued its rapid decline, a perfect setup for massive stock market collapse, and it is just a matter of time. Chances are central planners may want to wait until Trump has been inaugurated before they pull away support to the market and let the market collapse.

 

Support for NQ on Wednesday will be 4900. As long as NQ remains above 4900 selling should remains under control and NQ should continue to rally upwards. However, with all the major stock indices in extreme overbought territory there is a always a chance selling could come unexpectedly and from nowhere.

NQ Guideline For Tuesday

Ahead of the FOMC meeting this week NQ traded sideways in a very narrow range. With buy programs certain to go into full force look for the stock market to continue to go higher regardless of what the Fed decides to do and announces on Wednesday.

 

Key inflection price level for NQ on Tuesday will be 4865. First resistance is 4880 and first support is 4840.

-- If NQ can clearly break above 4880 it has the potential to trend up, with the next upside target of a break above Friday swing high.

-- Staying below 4865 implies continual sideways consolidation pattern.

 

Mortgage rates has risen very sharply, very bearish for the economy and the stock market. On Friday, the average lender hiked the 30-year fixed rate conventional mortgage for top tier borrowers to 4.25%. According to Freddie Mac, the average 30-year fixed-rate mortgage rate rose 5 basis points to 4.13% during the December 8 reporting week, the highest since July 2014:

 

NQ Guideline For Monday

Buy programs continued to hit the major wall street banks shares pushing the Dow and the S&P 500 into new highs on Friday. NQ simply traded sideways in a very narrow range.

 

Going forward, buying algorithm should continued to buy the major banks stocks, so we can expect to see the Dow and the S&P 500 to make new highs on a regular daily basis. But make no mistakes, this spectacular rally should soon be followed by a spectacular crash. The only question is when?

 

NQ continued to be dragged up. Key support zone for NQ on Monday will be 4870-4880 price zone.

-- If NQ can stay above 4870 it should continue to rally as selling should remains under control.

-- A clear break below 4870 is an indication that NQ may have to drop down to the next lower support level, 4840, before resuming its uptrend.
 

Government Bond selloff continues. The yield on both the 10-year and 30-year treasuries bond have risen over 1% since July, and is accelerating, a very bearish omen for the stock market, a prelude for a spectacular crash. 

NQ Guidelines For Friday

NQ traded sideways in a narrow range consolidation pattern on Thursday following a huge ramp up day on Wednesday. The ramp up of stocks especially the stocks of major wall street banks such as Goldman Sachs should continue until Trump become President.

By then, the stock market will be in extreme overbought territory and investors sentiment should be in extreme bullish mode, a perfect setup for a major top and the beginning of a sustained major stock market reversal, the beginning of a multi year bear market. Whether or not it would starts immediately after Donald Trump inauguration, it is impossible to tell in advance simply because it depends entirely on the bankers.

 

Key price level for NQ on Friday will be 4800.

-- With NQ trading above 4800 there should not be much action as the market may simply traded sideways in a narrow range again, unless of course they would come up with massive buy programs again.

-- In a very unlikely even NQ break back below 4800 in a sustained manner, look for selling to come in.

NQ Guideline For Thursday

Instead of resuming its down trend following two consecutive large down days central banks were determined to rally the market up. Central planners are likely to continue buying the stock market into the end of the year. As such, any dip in the market is a buying opportunity.

 

Support for NQ on Thursday is 4800.

-- As long as NQ remains above 4800 selling should remains under control, as central banks can easily push the market higher and higher.

-- In a very unlikely event, deflationary selling overwhelmed central banks, and push NQ below 4800, the next support will be 4760, 4740, 4700 

NQ Guideline For Wednesday

Another narrow range sideways consolidation day for NQ on Tuesday, the third consolidation day in a row following a sharp two days selloff last week.

 

Under normal circumstances, following a sharp selloff the market resumes after one or two day of consolidation. But there is nothing normal about the market these day because central banks control the market. So there is no more free market. As such, anything is possible.

 

Important price level for NQ on Wednesday will be 4800 resistance and 4760 support.

-- Under free market, the setup is for NQ to resume selling on Wednesday, but we don't have any free market so anything is possible. For selling to resume NQ needs to break below 4760 and then stay below. The next support below 4760 is 4740 then 4700.

-- If central planners can push NQ back up above 4800 then those who went short during last week selloff would be forced to cover, helping to trigger some kind of a rally.

 

Kyle Bass: Chinese Yuan Will Drop a Massive 30% to the Dollar

Guideline For NQ on Tuesday

Following a sharp 2-day selloff last week, Monday was the second pullback-up day for NQ. A one or two days consolidation following sharp selling is normal in a free market, and it should then be followed by a resumption of sharp selling.

 

But we do not have a free market any longer, as the markets are highly controlled by central banks, as such, anything is possible. The market can selloff as usual, or it could rally in a big way if central banks spends enough capital to push the market up.

On a short term timeframe, key price levels for NQ on Tuesday will be 4760 support and 4800 resistance.

-- If NQ can rally up to 4800 resistance but then failed to clearly break above 4800 it could attract enough sellers to push NQ back down to 4600 support where it could bounce of it or crash through it.

-- A clear and sustained break below 4760 could trigger a lot of selling activities. If so the next lower support is 4700.

NQ Guideline For Monday

The stock market including NQ traded sideways on Friday in a very narrow range, setting up for the next large trending down day, unless central planners is willing to intervene aggressively in the stock market.

And also, with the pro-globalist forces losing the referendum in Italy the stage is set for a return to protectionist policy all over the world, which will be very deflationary, thus adding fuel to an already accelerating deflationary forces.

 

Key price level for NQ for Monday will be 4700.

-- As long as NQ remains above 4700 selling should remains under control, NQ either trade sideways or rally, with resistance at 4760 then 4800.

-- A clear and sustained break below 4700 is likely to attract a lot of selling, next support at 4650 triply bottom then 4600.

NQ Guideline For Friday

The number of markets that central planners are still able to push up is getting fewer and fewer by the day. While the Dow continued to make a new high on Thursday NQ sold off hard for the second day in a row erasing 10 days of rally. The bond market has been selling off hard spiking interest rates across the board.

 

Deflationary forces is just beginning to overwhelm the best effort of central planners, even during a very bullish period of the year. Unless they are willing to create more currency and risk hyperinflationary currency collapse, the stock and the bond market selloff may starts to get more intense.

 

On the short term time frame, key price level NQ support on Friday will be 4740.

-- If NQ could not break-back above 4740 selling could come back in. If so, the next support is 4700, then 4650 double-bottom support.

-- Trading back above 4740 could keep seller at back until NQ can get back up to 4800 where heavy selling could come back in. NQ would need to break-back above 4800 to trigger some short-covering.

 

With deflationary forces getting more intense, battling central banks buying activities, we can expect high volatility market situation to get more volatile, creating more frequent wild market swings.

 

 

NQ Guideline For Thursday

Central planners were able to push both the Dow and the S&P 500 up to a new intraday high on Wednesday but NQ did not. Deflationary forces tanked NQ hard on Wednesday. It sold off right from the opening bell and into the close.

On Thursday the price level to closely watch is the 4800 key price inflection level both for the short term intraday timeframe and for the longer term daily chart timeframe.

-- Failure to remains above 4800 could trigger an avalanche of deflationary selling orders.

-- Staying above 4800 should keep sellers at bay, and an indication NQ may simply traded sideways or rally.