Nasdaq 100 - Signs of exhaustion
Since the latest CPI print NQ1! rose approximately 9%, with most of the move-up being manifested right after the release. The move was accompanied by high volume; however, on Friday and Monday, the volume declined substantially. This continuous decline in volume hints at exhaustion and potential reversal. Therefore, we remain very cautious.
To support our thesis, we would like to see a further slump in volume and the price going up. Then, we would like to see this followed by a spike in volume and the start of selling pressure. Contrarily, to invalidate our bearish thesis, we would like to see the price hold above 11 734$. Additionally, we would like to see the pick-up in volume accompanying a move higher.
On the endnote, we still believe this is only another bear market rally, and because of that, we stay bearish beyond the short term and stick to our price target for NQ1! at 10 000$.
Illustration 1.01
Since the latest CPI print, each session after the print manifested a declining volume from open to close. Yellow arrows indicate these developments on the chart.
Technical analysis - daily time frame
RSI, MACD, and Stochastic are all bullish. DM+ and DM- are bullish as well. Overall, the daily time frame is bullish, although the trend remains weak.
Technical analysis - weekly time frame
RSI and Stochastic point to the upside. MACD tries to reverse to the upside but stays in the bearish zone. DM+ and DM- are all bearish. Overall, the weekly time frame is less bearish than the last week.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
To support our thesis, we would like to see a further slump in volume and the price going up. Then, we would like to see this followed by a spike in volume and the start of selling pressure. Contrarily, to invalidate our bearish thesis, we would like to see the price hold above 11 734$. Additionally, we would like to see the pick-up in volume accompanying a move higher.
On the endnote, we still believe this is only another bear market rally, and because of that, we stay bearish beyond the short term and stick to our price target for NQ1! at 10 000$.
Illustration 1.01
Since the latest CPI print, each session after the print manifested a declining volume from open to close. Yellow arrows indicate these developments on the chart.
Technical analysis - daily time frame
RSI, MACD, and Stochastic are all bullish. DM+ and DM- are bullish as well. Overall, the daily time frame is bullish, although the trend remains weak.
Technical analysis - weekly time frame
RSI and Stochastic point to the upside. MACD tries to reverse to the upside but stays in the bearish zone. DM+ and DM- are all bearish. Overall, the weekly time frame is less bearish than the last week.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
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