Chart of the day Nasdaq 100 due for a potential bullish breakout

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By :  ,  Financial Analyst

Short-term technical outlook on Nasdaq 100 (Thurs, 05 Oct 2017)

Key technical elements

  • The US Tech 100 Index (proxy for the Nasdaq 100 futures) is the only major U.S. benchmark stock index that has not print a new all-time high as it has continued to hover below the intermediate range resistance of 6010/20 since 27 July 2017 (see daily chart)
  • In the shorter-term, the Index has started to evolve within a bullish ascending channel in place since the 28 Sep 2017 low where it staged a rebound from its medium-term pull-back support of the former “Expanding Triangle” range resistance  from 26 September 2017 high  (see hourly chart).
  • The daily RSI has managed to stage a rebound from its significant corresponding support at the 40% and it is now testing an intermediate descending trendline resistance. This observation suggests that medium-term upside momentum of price action has started to resurface.
  • The intermediate support rests at 5990 (lower boundary of the aforementioned short-term ascending channel) with key short-term support at 5975 (minor swing low of 04 Oct 2017 & close to the 23.6% Fibonacci retracement of the on-going up move from 26 Sep 2017 low to yesterday’ U.S. session high of 6011).
  • The significant short-term resistance stands at 6050/55 which is defined by the upper boundary of the aforementioned short-term ascending channel and a Fibonacci projection cluster zone (see hourly chart).

Key Levels (1 to 3 days)

Intermediate support: 5990

Pivot (key support): 5975

Resistances: 6010/20 & 6050/55

Next support: 5908


Therefore, the short-term uptrend of the Index in place since 26 September 2017 low remains intact as long as the 5975 key short-term pivotal support holds. In addition, the Index is due for a potential bullish breakout above 6010/20 for a further potential up move to target the next resistance at 6050/55 in the first step.

On the other hand, failure to hold above 5975 may negate the bullish tone to see a corrective pull-back back towards the next support at 5908 (minor swing low area of 28 Sep 2017 low & the 61.8% Fibonacci retracement of the up move from 26 Sep 2017 low to 04 Oct 2017 high).

Charts are from City Index Advantage TraderPro


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