Daily June E-mini NASDAQ-100 Index

E-mini NASDAQ-100 Index (NQ) Futures Analysis – March 22, 2013

With investors waiting for more news on Cyprus, there wasn’t much action in the June E-mini NASDAQ-100 Index overnight. The market did sell off early in the session, but quickly turned around when Greece agreed to take over some of the debt-ridden Cyprus banks. This news triggered a short-covering rally that put the index on the plus side.

The lack of economic reports today likely means the focus will be on Cyprus throughout the session. Traders are expressing optimism shortly before the opening that a deal will be reached between the European Central Bank and Cyprus. Earlier in the week the ECB gave Cyprus an ultimatum to accept the terms of the bailout or risk losing financial aid. Losing financial aid will likely lead to bank failures which would pressure equities.

Daily June E-mini NASDAQ-100 Index
Daily June E-mini NASDAQ-100 Index

Based on current trading conditions, traders seem to be leaning toward a deal before the week-end but this could change throughout the session. Therefore, we are likely to see a choppy, two-sided trade until a deal is reached.

Technically, the short-term range is 2748.25 to 2806.50. This has created a pivot price at 2777.40. The market is currently testing this pivot. Crossing over to the bullish side of the pivot could trigger a short-covering rally or draw the attention of new buyers.

A pair of Gann angles has helped form a triangle chart pattern. The resistance line of this triangle is 2777.00. The support line comes in at 2764.25. These two lines are currently compressing the price range, signaling impending volatility. Watch for a rally on a breakout over 2777.00. A trade through 2764.25 is likely to trigger an acceleration down to 2748.25. 

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.

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