NQ/QQQ Weekend Levels (Dec 12-16)

The Nasdaq closed the week down 2.72% after trading in a range of 552 pts. Price continued its back and for movement within the recent range that began on Nov 15th. The bulls and bears have been in balance as the market continues to process new information. The week ahead may provide the data the market needs to decide if the longer term down trend will continue or if price can break through the important 200 SMA and the major downward trendline. CPI data on Tuesday and the FOMC rate decision on Wed may provide the catalyst needed to break the Nasdaq out of its range.

• Down 2.72% last week
• Futures front contract rolled over from Z to H shifting data in the continuous contract
• Priced continues to trade in a tighter range which began Nov 15th
• CPI data due out Tuesday
• FOMC Rate decision and Powell commentary Wednesday
• Nasdaq chopping above and below ema clouds just below 200 sma
• Nasdaq likely to follow the direction of the S&P
• Narrative has flipped from Inflation to Recession
• Fed pivot could be perceived as negative as it may confirm recession
• Recent range high/low = 1st resistance/support
• 200 SMA = longer term resistance/June 16th low = longer term support
• Powell FOMC comments the most important thing to watch this week.
• Massive move in either direction possible important to keep bias neutral

WEEKLY EVENTS

Monday OPEC Monthly Report
Tuesday US CPI
Wednesday EIA Crude Inventories, FOMC Interest rate decision & commentary
Thursday US Retail Sales, US Jobless Claims & US Industrial Prod.
Friday US S&P Services PMI Flash & Manufacturing PMI Flash

NOTABLE EARNINGS

Monday COUP, ORCL
Tuesday BHP
Wednesday LEN , TCOM
Thursday ADBE , NTDOY
Friday DRI

BULLISH NOTES

Nasdaq continues to form base pattern
200 SMA within striking distance
Potential positive reaction to CPI data
Potential positive reaction to Powell comment
Break above downward trend line may cause massive, short covering rally

BEARISH NOTES

Price back below 9/21/55 ema
Price below downward trendline & 200 SMM
Longer term trend remains down
Market expects at least one more flush lower
There has been no VIX spike above 40
Potential negative reaction to CPI data
Potential negative reaction to Powell comments
Massively inverted yield curve = potential recession

Comment:

With this sort of back and forth price action I am expecting chop leading into the CPI and FOMC. Very hard to predict a direction so best just to wait or trade the edges of the ranges.

Comment:

Chopped until a later day rally yesterday. Now a huge 400 + pt rally off CPI. NQ has a very bullish look to it now with 1st target at the 200 sma above if trend continues. ES at key resistance now so must be cautious of a hard reverse on the cash open. A break down below the ascending trend line would be very bearish.

Comment:

NQ faded to the 50% point on the big move. Remain bullish above bearish below.

Comment:

The 50% failed to hold on the retracement and the NQ filled the entire gap. It is very rare that a gap this large fills in one day. It shocked me yesterday and makes me very cautious today. Have no choice but to expect wild moves going into FOMC. So very small trades (if any) are recommenced unless you have a very good read on the price action.

Comment:

Following FOMC the NQ has resolved lower and now testing the lower ascending trendline. Key zone to hold for the bulls if the two marked pivots cannot hold a move back down to the June 16th low is possible.

Comment:

Careful of heavy shorts here. May find support at the trendline

Comment:

Here are some levels for Friday morning. A little messy with Fibs but they are all important. Broke the trendline and ran to the 1.13 Fib. Rejected off the trendline and fell to the 618 fib just above the June 16th low. A break of the 618 now could lead to a run down to the 886. If the 618 holds a move back up to the daily 9 ema is possible.