Nasdaq Composite Technical Analysis – We are at a crucial support

Last week, the Fed kept interest rates unchanged as
expected but revised the Dot Plot on the more hawkish side with one more rate
hike still expected by the end of the year and much less rate cuts projected
for 2024. Fed Chair Powell has also
admitted that the soft-landing scenario is not his base case at the moment despite
the good macroeconomic projections, and that stronger than expected economic
data may require additional tightening. For now, the economic data remains indeed
strong with Jobless Claims crushing
expectations last week and the US PMIs
remaining quite resilient.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite sold off following the more hawkish than expected FOMC dot plot and
has now reached the key support around
the 13174 level where we have also the confluence with the
38.2% Fibonacci retracement level
and the trendline. This is
where we can expect the buyers to pile in with a defined risk below the
trendline to position for a rally into the highs. The sellers, on the other
hand, will want to see the price breaking below the trendline to pile in even
more aggressively and target the 12274 support.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see more closely the
support zone around the 13174 level. The price bounced on it yesterday and we
might see a pullback into the swing level around the 13400 level where the
sellers will be waiting to sell into the rally targeting a break below the
trendline.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
clearly the bearish setup with the resistance around the 13400 level where we
have also the confluence with the downward trendline and the Fibonacci
retracement levels. This is where the sellers are likely to step in with a
defined risk above the trendline and target a break below the major upward
trendline. The buyers, on the other hand, will want to see the price breaking
above the downward trendline to invalidate the bearish setup and position for a
rally into the highs.

Upcoming
Events

Today we will see the latest US Consumer Confidence
report which surprised to the downside the last time and led to a rally as
interest rates expectations turned more dovish. On Thursday, we will have
another US Jobless Claims report which keeps on showing strength in the labour
market maintaining the hawkish pricing steady. Finally, on Friday, we will get
the latest US PCE data.