The NASDAQ index is up 127 points or 1.0% at 12721.65, but this week saw a sharp move lower that took the price below its 200 day moving average for the 1st time since March 2023. The price also fell below the 38.2% retracement of the move up from the 2022 low to the 2023 high. Those levels come in at 12785 and 12781 respectively.
Going into the new trading week staying below those levels keeps sellers more control.
Having said that, the low price for the week also tested a key moving average level on the weekly chart. That moving average was the 100-week moving average which comes in at 12574.61. Although the low price for the week reached below that level at 12543.86, momentum could not be sustained, and the price rebounded back above that moving average level.
So as we head into a fed week where the focus will be on the Fed decision (and ultimately is influence on interest rates and stocks as well), those levels will be in play and help to define the next moves in US stocks.
Moving back above the 200-day moving average of 38.2% retracement would be more bullish.
Moving below the 100-week moving average would be more bearish.
In between could be thought as more neutral with a negative bias.
This article was written by Greg Michalowski at www.forexlive.com. Source