NQ Guideline For Friday

NQ opened with a gap-down then traded down below prior day low where trailing stop-losses congregates, running over stop-losses, and crash hard, down over 700 points from prior day close.

 

Unless the Fed can push the market overnight ahead of the employment report to be released before the market open in the morning, NQ is set to tank hard at soon after the open if margin-selling materializes.

 

Key price level to watch tomorrow will be 11,850, then the pivot at 11,900 as possible resistances for the profit-taking rally ahead of the long weekend.

 

Below Pivot, we either get heavy selling, a crash, or just the normal Friday pattern, the sideways pattern.

Here are the charts showing current market extreme bullishness

NQ Guideline For Thursday

A huge opening gap-up on Wednesday was aggressive sold, with NQ dropping sharply down to critical support, the 200-ma on the 5-minute chart before market manipulators were able to reversed it back up. NQ closed near the high of the day on Wednesday.

 

NQ may continue to trade sideways on Thursday with key support at 12,260 and resistance at Wednesday swing high at 12,440.

 

As long as Wednesday swing low is not clearly violated NQ should remains in sideways trading mode. However, should Wednesday low is clearly broken we could see a big decline. If so the next support level is 12,000-12,050

NQ Guideline For Wednesday

Another trending up day for NQ on Tuesday. It is rare to see two trending up days in a row. However, on the daily chart, we can clearly see NQ in parabolic type of up move, as such the patterns is displaying abnormal characteristics.

 

With the US dollar continuing to tank, money rush into stock, pushing the stock prices upward. It is very difficult to forecast when the parabolic move will end as it is driven by emotion. But when it does ends, the reversal is fast and swift.

 

Key inflection price level for NQ on Wednesday will be at 12,260

-- Bullish above, next upside target is a higher high above Tuesday swing high.

-- Bearish below it, with downside target at 12,160

 

NQ daily chart showing it is now in parabolic move up.

 

NQ Guideline For Tuesday

NQ trend up all day on Monday with the open near the low of the day and the close near the high of the day, a bullish close.

 

Very often, after a trending day we would see a sideways consolidation pattern trading between the 200-ma support and a new higher high, usually achieved in the early trading session as traders gets very bullish in the early morning, then profit-taking sets in and cause a decline down to supports, Floor Traders Pivots or all the way down to 200-ma on the 5-min chart.

 

Key line-in-the-sand tomorrow will be at 12,090

-- Bullish above targeting a break above Monday high

-- Bearish below it, targeting 200-moving average on the 5-minute chart

NQ Guideline For Monday

Friday was day two consolidation after a large trending up day on Wednesday, and it was also an inside day, setting a large trending day, and it could trend large on Monday.

 

Daily trend is up, but it is now going into a parabolic mode, vulnerable to a sharp reversal down.

 

The 60-minute trend is also up, but setting up a bearish divergence on a break above the high.

 

The key to a trending move is the opening that is outside prior trading range. Opening outside prior day range sets up a large trending move in the direction of the breakout, or it can set up a large reversal day, which is a trending move in the direction opposite of the breakout.

 

On Monday, the key price level will be prior day high and prior day low.

-- Opening above prior day high is an indication the trend is up, as long as it does not break back into prior day trading range.

-- Opening below prior day low is an indication the trend is down, as long as it does not break back up above prior day low.

 

A break back into the prior day trading range, after opening outside prior day range, is a indication of a reversal day.

NQ Guideline For Friday

As expected NQ traded sideways on Thursday following a large trending up day on Wednesday.

 

With Friday tending to be a choppy sideways type of day, we could see another day of sideways pattern.

 

NQ would have to opens outside Thursday trading range to trigger a trending day or a fast reversal day

 

11,950 will be a key line-in-the-sand for NQ on Friday.

-- Bullish bias above it, upside target is above Thursday high.

-- Bearish bias below it, with downside target at either the 200--ma  or below Thursday low

NQ Guideline for Thursday

A breakout day for NQ on Wednesday with NQ opening with a gap-up above prior day high. Profit-taking soon after the open failed to tank NQ lower. Those who went short were forced to cover as NQ rallied higher all day.

 

NQ closed at the high of the day. With such a large up day on Wednesday it is likely that NQ would need to consolidate the hug rally and spend Thursday trading sideways.

 

However, with the Fed currently at their annual meeting in Jackson hole, any unexpected statement could change the market pattern in an instant.

Key line-in-the-sand for NQ on Thursday will be at 11,900

-- Bullish above, with upside target is a break above Wednesday swing high.

-- Bearish below it with lower target at 11,800

NQ Guideline For Wednesday

On Tuesday NQ opened with a gap-down but still above the key support level on the 5-minute chart, thus it opened with a bullish bias.

 

As such, NQ slowly rallied higher as the shorts continued to cover. Although the close was at prior day high many of the stop-loss are still above Monday swing high, which should give a huge incentive to the market manipulators to push the market higher just to run-over the stop-losses so that they can then exit and reverse short.

 

Without enough buyers to overwhelmed selling on a break above Monday swing high, NQ should reverse sharply back down.

 

So the key line-in-the-sand once Monday swing high has been broken will be Monday's high. Once broken, NQ either rocket higher or reverse sharply back down.

NQ Guideline For Tuesday

NQ opened with a huge gap-up to end wave 5 up on the 60-mnute chart as mentioned in yesterday guidelines. A such NQ sold off very quickly on monday, dropping down to support before trading sideways, consolidating the huge decline.

 

NQ is set to drop lower on Tuesday, but strong support is now at 11,540. NQ would need to clearly break below Monday swing low to trigger more selling. if so the next support is 11,440, then a much stronger support at 11,275 

 

However, as long as 11,540 support is not clearly violated we would see more sideways trading pattern, or a rally back up to Mondays swing high simply because the market is being directly supported by the Fed, and the may not want to let the market go down.

NQ Guideline For Monday

After a large up-trending day on Tuesday NQ traded in a narrow-range sideways consolidation pattern.

 

On Monday, a new higher high in the morning could then be followed by a pullback down move, but expecting it to rally back up as long as the down-move does not get too large.

 

Key inflection price level for NQ on Monday will be 11,540

-- If NQ opens and trade above 11,540 we could see NQ makes a higher high first, but then pullback down.

-- If NQ should break below 11,540 during the pullback down move we could then see a quick drop down to 112,440 area before rallying back up again.

-- If the open is below 11,540 in the morning we should see a quick drop down to 11,440 before rallying back up to make another higher high, provide it can re-break back above 11,540.