E-mini NASDAQ-100 Index (NQ) Futures Analysis – March 8, 2013

The March E-mini NASDAQ-100 index spiked up to 2827.75 after the U.S. government announced that 236,000 new jobs were added to the economy in February. This number blew away the consensus guess of 160,000. The unemployment rate also fell to 7.7%, its lowest level since December 2008.

After surging to 2827.75, the index is backing down. This could be because of resistance near the October 5 top at 2830.00 or because of overbought conditions. Since today is the eighth day up since the 2689.00 bottom, traders should start to watch for signs of profit-taking. The usual formation to watch for following this type of rally is the closing price reversal top. This can occur on the hourly or daily chart, and often signals the start of a short-term correction, but not necessarily a change in trend.

Daily March E-mini NASDAQ-100 Average
Daily March E-mini NASDAQ-100 Average

The initial rally this morning put the index on the bullish side of an uptrending Gann angle at 2817.00. This move didn’t last too long so the index is in effect straddling this line shortly before the opening. Those already in long positions should be concerned about protecting the downside. The key level to watch is 2788.25. A break through this level could trigger an acceleration to the downside. If a move through 2788.25 can be sustained, fresh selling pressure could drive the market into another key support level at 2753.00.  

Today is shaping up to be a highly volatile day. Bullish traders should watch for an upside breakout over 2830.00. Bearish traders or those looking to take profits should watch the market’s reaction on a test of 2788.25. 

NASDAQ Futures Forecast March 8, 2013, Technical Analysis

The NASDAQ futures market rose slightly during the session on Thursday, as the market consolidates around the 2800 level. This area represents a significant barrier, but we believe that the market is about to overtake it in fairly short order. With the jobs number coming later today, there is a possibility that we get some type of sharp pullback in reaction to the announcement. If that happens, that should simply be a buying opportunity. We like this market, and will continue to buy going forward. It isn’t until we get below the 2700 level that we feel selling this market is even remotely possible.

 

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E-mini NASDAQ-100 Index (NQ) Futures Analysis – March 7, 2013

The March E-mini NASDAQ-100 Index is trading a little better this morning following a surprise weekly jobless claims report. This week’s jobs data showed a dip that claims fell by 7000. This gave the futures market a boost, leading to the higher opening. Today could shape up to be a volatile session as investors may decide to take advantage of the higher prices and pare their positions into the close ahead of tomorrow’s U.S. Non-Farm Payrolls report.

Friendly comments from European Central Bank President Mario Draghi helped drive the EUR/USD higher, leading to increased demand for higher risk assets. This morning the ECB kept interest rates unchanged, but it was the friendly tone from Draghi that triggered the intraday short-covering rally. Draghi said that inflation expectations remain “firmly anchored”. This was interpreted by traders to mean that an interest rate cut was not forthcoming.

Daily March E-mini NASDAQ-100 Index
Daily March E-mini NASDAQ-100 Index

Technically, Wednesday’s closing price reversal top formation is potentially bearish, but it has to be confirmed by a break through 2788.25. A move through this low will set in motion a potential 2 to 3 day break equal to at least 50% of the last rally.

Based on the range of 2689.00 to 2809.25, the next potential downside target is 2749.25 if the closing price reversal top can be confirmed. In addition, uptrending Gann angle support comes in at 2745.00.

On the upside, crossing over to the bullish side of an uptrending angle at 2801.00 will put the market in a position to test the top at 2809.25.

Investors could see a two-sided trade today, if there is selling pressure late in the session in front of Friday’s U.S. jobs report. Long-term investors may be using the NASDAQ futures contract as a potential hedge against a sell-off in the Dow and S&P. This may explain why the NASDAQ closed lower on Wednesday while the Dow and S&P closed higher. 

NASDAQ Futures Forecast March 7, 2013, Technical Analysis

The NASDAQ futures market fell during the session on Wednesday, pulling back in order to form a shooting star. This is obviously a very bearish sign, and a break of the bottom would have us selling our already long positions. However, we think that any pullback at this point time will be temporary in nature, and as a result will be looking for supportive candles to reenter the market from. We have no interest in selling this market for anything along the lines of a short position until we get well below the 2700 level, something that seems very unlikely in the very short-term.

 

NASDAQ Futures Forecast March 7, 2013, Technical Analysis
NASDAQ Futures Forecast March 7, 2013, Technical Analysis

Precious Metals Under Pressure As Equity Markets Soar

World News BNSPrecious metals prices rose yesterday, but the breakout in Wall Street stocks to new highs and data showing an improving U.S. economy pressurized the precious metal’s safe-haven appeal. The Fed’s Beige Book showed a slow recovery but a positive recovery was underway with an improvement in most sectors. The slowing factor was the “fiscal cliff” and the new payroll tax increases and all the political rhetoric from Washington, held back consumers and businesses. With most of this behind the economy is expected to pick up its pace of recovery. The ADP release yesterday showed that the economy had generated over 198,000 new jobs against estimates of 170,000. This gave a bump to the US dollar and held gold down as the good news on one front can be bad news for central bank speculators as it might push the central bank to lower or terminate its monetary stimulus program. This helped support the US dollar and kept gold on the weak side. Gold is holding at 1580.50 this morning adding a few dollars as traders take advantage of the weak price ahead of central bank decisions today.

Global central bankers are meeting today in Japan, England and Brussels and more stimulus or lower interest rates are expected. This afternoon’s press conference by Mario Draghi is expected to have major market effects.

Holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange traded fund, stood at 1244.86 tons by Mar 06, remains unchanged from the previous business day. While holdings in the world’s largest silver backed exchange-traded fund iShares Silver Trust stood at 10646.48 tons by Mar 06, remains unchanged from the previous business day.

Gold importers in India feared volatility in the rupee against the strong US dollar which plays an important role in determining the landed cost of the dollar denominated bullion, seeking bigger falls in the yellow metal from their lowest level in nearly a week. Gold speculators are staying out of the market until the US dollar eases. The US dollar has been strong since last week when the “sequestered” budget cuts were left in place, as traders moved to the safety of the greenback.

Positive U.S. economic data dented bullion’s safe-haven appeal. Automatic spending cuts that kicked off in the United States on Friday, pushing spot gold to its lowest level in more than a week, also continued to weigh. Recent weakness in the global market has triggered physical buying interest in Asia, particularly in China, as the spread between onshore prices and international prices widens, cushioning the fall in dollar-priced gold. The overall improving outlook for the global economy has boosted risk appetite and pulled investors to higher-yielding assets such as equities.

Traders will closely watch the central bank action today along with US unemployment numbers ahead of tomorrow’s nonfarm payroll release.

Equities seem to be the biggest beneficiary of the inflow of funds as traders remain in a positive mood. The Dow Jones, NASDAQ index and the S&P 500 ended in green. The Dow was up by 0.30% and closed at 14296; S&P 500 was gained by 0.11% at 1541. European indices ended mixed. The FTSE was down by 0.07%, the DAX gained by 0.62% and the CAC 40 was down by 0.35%.This morning major stock markets in Asia are trading mixed. Shanghai Composite is down by 0.61% at 2333 and Hang Seng is up by 0.03% at 22784. Japan’s Nikkei is up by 0.60% at 12004 and Singapore’s Straits Times up by 0.03% at 3293. As long as traders stay in equities there is little chance for gold or silver to climb. Although with precious metals flat, industrial metals have been gaining on positive recovery tones giving silver additional momentum as it is pressing for the 29.00 mark this morning trading at 28.92

E-mini NASDAQ-100 Index (NQ) Futures Analysis – March 6, 2013

The March E-mini NASDAQ-100 index is following through to the upside after Tuesday’s strong surge. A jump of 198,000 jobs in February according to the private firm ADP is helping to drive the market higher this morning. Later in the session, investors will shift their focus to a factory orders report and the release of the Fed’s Beige book. This report will give investors a few clues as to the strength in the regional economies.

Although the market is strong ahead of the opening, investors may begin to pare positions later in the session because of overbought conditions and because of tomorrow’s key central bank meetings. Most investors are looking for the European Central Bank, the Bank of England and the Bank of Japan to maintain their easy money policies, but may want to take protection ahead of their meetings.

Daily March E-mini NASDAQ-100 Index
Daily March E-mini NASDAQ-100 Index

Additionally, it’s hard to tell how many new investors jumped on the bandwagon during this current run. Because of this, complacency could become an issue. Many investors feel that Fed Chairman Bernanke green lit this current run a couple of weeks ago when he said that the central bank had no plan to end its bond-purchasing program earlier than expected. Keeping this in mind, these investors may feel that nothing can stop the rally, but may have forgotten about issues such as the Italian election stalemate. This event is still lingering and can cause investors to seek protection if it once again becomes a major issue and investors begin to talk about the Euro Zone debt crisis again.

Technically, the main support angle is at 2785.00. This angle is controlling the strength and direction of the market. Breaking through this angle will be a sign of weakness, however, not necessarily a change in trend.

The March E-mini NASDAQ-100 Index starts the session up six days from the bottom at 2689.00. Typically, markets top out in the 7 to 10 day period. Investors should start watching for signals that selling pressure is increasing. The best signal is the hourly closing price reversal top. Although today may be a bullish day, starting tomorrow the index may begin to weaken especially since the U.S. jobs data will be released on Friday. 

NASDAQ Forecast March 6, 2013, Technical Analysis

The NASDAQ had a strong showing during the session on Tuesday, piercing the 2800 barrier. This market looks like it’s ready to go higher, so a break above the highs from the Tuesday session is enough to get us to start buying again. We think this market has farther to go, and the recent consolidation lasting roughly 2 months is a sign that there are plenty of traders willing to jump in and push his market higher. After all, we simply haven’t had a significant pullback, but certainly that enough sideways action to negate the need for such moves.

 

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E-mini NASDAQ-100 Index (NQ) Futures Analysis – March 5, 2013

Stronger demand for higher risk assets is helping to drive the March E-mini NASDAQ-100 Index overnight. News that China is expected to increase spending is one of the catalysts behind the move. This is followed closely by the Reserve Bank of Australia’s decision to refrain from an interest rate cut.

Traders will be looking at the Institute for Supply Management’s (ISM) non-manufacturing index for direction today, and the U.S. Non-Farm Payrolls report on Friday. Today the ISM is expected to dip to 55.0 from 55.2 in February.  

Yesterday the NASDAQ shook off a lower opening triggered by bearish news from China. Today, traders are buying after China announced a plan to achieve a 7.5 percent growth target. Traders are also shaking off the “sequester” in the U.S. Although President Obama is still looking for a compromise over the mandatory spending cuts which went into effect on March 1, it doesn’t look like he is going to get what he wants as Republicans are already looking for ways to prevent a government shutdown.

Daily March E-mini NASDAQ-100 Index
Daily March E-mini NASDAQ-100 Index

Traders will also be watching the action in the Dow Jones Industrial cash index as it approaches its all-time high. This could turn out to be a non-event if buyers decide not to chase the market higher. The primary focus today is likely to be on the higher-risk currencies. If they can continue to attract investors then the NASDAQ is likely to remain in strong hands all day.

Technically, the March E-mini NASDAQ is surging ahead of the opening after taking out a pair of tops at 2761.50 and 2764.50. In addition, it has crossed over to the bullish side of an uptrending Gann angle at 2769.00. This angle is likely to be early support.

Overnight, in a sign of strength, the futures contract took out a weak downtrending Gann angle at 2768.50. This is also a sign of building buying interest. The next upside target is 2777.50, followed by the contract high at 2786.50. 

NASDAQ Futures Forecast March 5, 2013, Technical Analysis

The NASDAQ futures rose during the session after initially plunging on Monday, to form a little bit of a hammer. This hammer isn’t necessarily a strongly one, but it does suggest that we are going higher. Because of this, a break of the high from the Monday session is reason enough for us to start buying, and we do believe that this market will eventually test the 2800 level. Going forward, we will not be selling this market, rather buying dips on the shorter-term time frames such as the hourly chart, as we believe that this will be more of a grind higher than a sprint.

 

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E-mini NASDAQ-100 Index (NQ) Futures Analysis – March 4, 2013

The March E-mini NASDAQ-100 Index is trading lower this morning. Traders are reacting to bearish news out of China. Due to the absence of any major U.S. economic reports, investors are likely to react to news out of Washington regarding the Federal budget cuts, or any new developments regarding the Italian election results and there potential impact on demand for higher yielding assets.

Currently the index is trading inside of Friday’s range. This is usually an indication of indecision and impending volatility. Given the strong rebound rally on Friday, one has to conclude that there is a slight bias to the upside, but the fact that the main trend is down on the daily chart suggests that gains could be limited.

Based on the main range of 2786.50 to 2689.00, a major retracement zone has been formed at 2737.75 to 2749.25. This market has been straddling this zone the past four trading sessions. It is unclear at this time whether this can be construed as accumulation or distribution.

Daily March E-mini NASDAQ-100 Index

A move through a downtrending Gann angle at 2754.50 would be an indication that the bias is to the upside, but it will take a trade through the two tops at 2761.50 and 2764.50 to indicate trader clarity and conviction. If this move takes place then look for the rally to continue to 2770.50.

The index turns weak on a sustained move through 2737.75, but this is only likely to drive it into an uptrending Gann angle at 2721.00.

Until the March E-mini NASDAQ-100 sheds the retracement zone, traders should anticipate a choppy, two-sided trading session. 

NASDAQ Futures forecast for the week of March 4, 2013, Technical Analysis

The NASDAQ futures fell during most of the week, but bounced off of the 2700 level in order to form a classic looking hammer. This hammer suggests that there is plenty of support underneath this market, and the 2700 level has held up repeatedly over the last couple of months. Because of this, we believe that this market is going higher, and a break above the highest for this previous week would be enough to get us to start buying again. As for selling, we would have to break well below the 2600 level be comfortable doing so as we see so much support between here and there.

 

NASDAQ Futures forecast for the week of March 4, 2013, Technical Analysis
NASDAQ Futures forecast for the week of March 4, 2013, Technical Analysis

NASDAQ Futures Forecast March 4, 2013, Technical Analysis

The NASDAQ futures market fell initially during the Friday session, but as you can see bounced back nicely in order to form a hammer. Because of this, it appears that the NASDAQ wants to go higher, and we are willing to buy on a break of the highs for the session as it shows that momentum is now working for us. Going forward, we see the 2700 level as being massively supportive, and as a result are not interested in selling this market at all. A move above the 2800 level would have this market roaring much higher.

 

NASDAQ Futures Forecast March 4, 2013, Technical Analysis
NASDAQ Futures Forecast March 4, 2013, Technical Analysis
 

E-mini NASDAQ-100 Index (NQ) Futures Analysis – March 1, 2013

A drop in demand for higher risk assets is pressuring the March E-mini NASDAQ-100 this morning. The market is feeling downside pressure after an earlier session rally faded into the close on Thursday. The rally now appears to have been corrective in nature, leading to speculation that there is more to go on the downside.

There is a growing negative bias to the market ahead of the opening due to a sell-off in Asia and Europe. Asian traders are reacting to a report indicating that the Chinese economy is cooling. European markets sold off after the Euro Zone unemployment rate increased to a record 11.9%. Speculators are betting that the European Central Bank is poised to lower interest rates in order to stimulate the region and to help it dig out of a deepening recession.

In addition to the news out of Asia and Europe, investors are dealing with the uncertainty of the across the board Federal government spending cuts implemented today. With uncertainty comes risk and investors appear to be willing to avoid this risk at all costs especially when it has a direct effect on their profitable positions.

Technically, Thursday’s rally failed after the market took out a Fibonacci price level at 2749.25. This price is now resistance along with a 50% price level at 2737.75. Additional resistance is at a downtrending Gann angle at 2758.50.

Daily March E-mini NASDAQ-100
Daily March E-mini NASDAQ-100

Overnight the March E-mini NASDAQ-100 crossed over to the bearish side of a downtrending Gann angle at 2730.50. This price has become new intraday resistance.

The first downside target today is 2713.00, followed by 2701.00. If downside momentum is strong enough then look for the index to challenge the low for the week at 2689.00.

It doesn’t look like there are any economic reports today that could stem the slide in prices. Additionally, Washington may have gone home for the week-end meaning that nothing can be done about the spending cuts. This means the potential for a “risk off” scenario all session long. 

NASDAQ Futures Forecast March 1, 2013, Technical Analysis

The NASDAQ futures market rose during the session on Thursday, but gave back a bit of the gains in order to form a tiny shooting star. This shooting star doesn’t necessarily signify the beginning of anything serious; rather it looks like we’re going to be pulled back to the 2700 level. If we managed to break lower, we believe this will be a buying opportunity, especially at 2700 as it has been so supportive. Alternately, if we managed to break the top of the range for the Thursday session, we believe that would be very bullish as well.

 

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E-mini NASDAQ-100 Index (NQ) Futures Analysis – February 28, 2013

The March E-mini NASDAQ-100 is called steady to better this morning following Wednesday’s strong rally. Overnight there was no follow-through to the upside which makes one wonder if the rally was triggered by new buying or by profit-taking. The fact that the index is trading inside of a retracement zone bounded by 2737.75 to 2749.25 means there is balance. This balance is being created by trader indecision.

Bringing worry and uncertainty to the market are short-term factors such as the potential Euro Zone debt crisis, a slowing U.S. economy and a possible negative impact on the economy because of the mandatory spending cuts which kick in on March 1.  

Earlier this week, Fed Chairman Bernanke basically said that interest rates would remain low indefinitely. His commentary takes care of the long-run, but the major issue at this time is the short-run. Investors are not sure whether to wait for a bigger correction to catch stocks at cheaper prices, or to chase it higher.

Daily March E-mini NASDAQ-100 Index
Daily March E-mini NASDAQ-100 Index

Technically, based on the range of 2786.50 to 2689.00, the key area to watch is 2737.75 to 2749.25. This retracement zone is acting like a pivot this morning.

Currently, the market is sitting on a downtrending Gann angle at 2738.50. Holding above this angle should trigger a rally to 2762.50. A failure to hold this angle will put the market in a weak position and could trigger a decline into 2721.00.

Basically, the current chart formation is calling for volatility. A bullish scenario means a test of 2762.50 while a bearish scenario means a near-term break to 2721.00. 

NASDAQ Futures Forecast February 28, 2013, Technical Analysis

The NASDAQ futures rose during the session on Wednesday, bouncing from the 2700 level. This level has proven itself to be supportive time and time again, and the Wednesday session will have been no different. With this in mind, we like buying this market on pullbacks as it is an excellent short-term trading vehicle right now. However, we do see quite a bit of resistance above, but do recognize the fact that the easiest path for this market going forward definitely is up. We think that eventually the 2800 level will be overcome, and this market can go ahead and continue to the 3000 level.

 

NASDAQ Futures Forecast February 28, 2013, Technical Analysis
NASDAQ Futures Forecast February 28, 2013, Technical Analysis

E-mini NASDAQ-100 Index (NQ) Futures Analysis – February 27, 2013

After nearly reaching an exact 50% retracement level, the March E-mini NASDAQ-100 formed a daily closing price reversal bottom, indicating that the buying may be greater than the selling at current price levels. Although the formation is potentially bullish, it is going to take a breakout over 2718.25 to confirm the chart pattern.

The longer-term picture suggested that 2683.25 to 2658.90 was a major retracement zone target. On Tuesday, the market reached a low of 2689.00 before buyers stepped in. Based on the short-term range of 2786.50 to 2689.00, the next potential upside target is a retracement zone at 2737.75 to 2749.25.

Daily March E-mini NASDAQ-100 Index
Daily March E-mini NASDAQ-100 Index

This morning the market is trading on the bullish side of a downtrending Gann angle at 2706.50. This is a sign of developing strength, but until the index can pull away from this angle, it may act as an intraday pivot price. If the market can sustain a move above this angle and breakout above 2718.25 then look for a test of another downtrending Gann angle at 2746.50.

Fundamentally, positive testimony from Fed Chairman Ben Bernanke helped put in yesterday’s bottom. Bernanke said that he supported the central bank’s asset buying program which is seen as a positive for the market because it maintains the liquidity that is important to the long-term rally.

Today’s catalyst is likely to be the Italian election. Overnight reports said the parties involved in the election deadlock are talking. This is helping to ease worries of a prolonged discussion that will likely bring uncertainty to the market. Uncertainty tends to pressure the market while driving up volatility. 

NASDAQ Futures Forecast February 27, 2013, Technical Analysis

The NASDAQ futures had a slightly bullish session on Tuesday as the 2700 level offered support again. The resulting candle is somewhat of a hammer, but isn’t necessarily long enough to be impressive. Because of this, we think that the 2700 level is a fairly safe bet as far as trying to find support, and as such we are willing to buy the top of the candle if we can break to that level. Until then, we are more interested in simply being on the sidelines than anything else. Going forward though, we do believe that the NASDAQ will be going higher.

 

NASDAQ Futures Forecast February 27, 2013, Technical Analysis
NASDAQ Futures Forecast February 27, 2013, Technical Analysis

E-mini NASDAQ-100 Index (NQ) Futures Analysis – February 26, 2013

The March E-mini NASDAQ-100 is called higher this morning. The market did not follow-through to the downside after Monday’s huge sell-off, leading to speculation that the break may have been overblown and that the index may be ripe for a short-covering rally. Based on the short-term break from 2786.50 to 2691.75, there is the possibility of a strong retracement rally to 2739.15 – 2750.35.

The major range is 2580.00 to 2786.50. This range has created a retracement zone at 2683.25 to 2658.85. This zone is the next downside target and represents value to most NASDAQ traders. Buyers may defend a break into this area. If enough buyers show up in this zone then look for the start of a strong rebound rally.

Daily March E-mini NASDAQ-100 Index
Daily March E-mini NASDAQ-100 Index

The main trend is down on the daily chart. The main trend turned down last week when the market crossed 2754.25. Downtrending resistance is at 2722.50. Although the first test of this angle could produce a technical bounce, the ultimate upside target is 2739.15 to 2750.35.

Fundamentally, the market remains susceptible to news out of Europe regarding the Italian election results. Italian interest rates will be the best indicator as to how investors feel about the impending results. Higher rates mean there is risk and uncertainty. These two factors are likely to keep the pressure on the NASDAQ.

Fed Chairman Bernanke’s testimony today will also be highlighted. Investors will be listening for any hints regarding an early end to the central bank’s asset-buyback program. If Bernanke says it is possible then look for another round of weakness. If Bernanke says the idea is off the table until the economy improves then we may see a strong short-covering rally.

Since this is a news driven market, traders should watch for volatility and be ready for sudden shifts in direction. The bears are trying to establish a top while the bulls are bargain hunting and looking for cheap stocks. This type of trading means there is no clear leader, leading to the strong possibility of a two-sided trade. 

NASDAQ Futures Forecast February 26, 2013, Technical Analysis

The NASDAQ futures try to rally during the session, but were cut off at the knees later in Monday trading. We formed a shooting star, and as a result it looks very bearish all of a sudden. However, the 2700 level lies just below the surface, and should be significant support. Below there is a significant gap, and because of this we are not very clear about shorting this market presently. In fact, we are more than likely going to leave this particular market alone as shorting this market will certainly be difficult until we get below the 2600 level.

 

NASDAQ Futures Forecast February 26, 2013, Technical Analysis
NASDAQ Futures Forecast February 26, 2013, Technical Analysis