Nasdaq Approaching Trend Line

The Nasdaq 100 futures (/NQ) is approaching a downward trendline.  Given recent lower highs, and the bearish environment today, there is a decent probability that this could reverse to send the Nasdaq down.

On this hourly chart, the beginning of the blue trendline begins 12/7.  In its middle is the peak on 12/17, where it quickly tumbled down.

Nasdaq 100 futures approaching trend-line.

Nasdaq 100 futures approaching trend-line.

Note that the yellow line it approached on 12/17 was its July high, a price line it seemed to ignore in November and the beginning of December, but has recently appeared to matter.  I have treated the points when it went above this line as “look-and-fail” rather than an outright breaking of it, which looks especially true when you consider its repeatedly large drop afterwards.

The bottom line is that today looks like a potential short market entry point.  I personally plan to accomplish this by going long volatility via UVXY options.

To provide some perspective, here is the 1 year chart of the /NQ.  You can see the same blue trend-line, and the yellow price line.

Nasdaq 100 Futures (/NQ) 1 year daily cahrt

Nasdaq 100 Futures (/NQ) 1 year daily cahrt

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About Erik Calco

With a passion for Investing, Business, Technology, Economics, People and God, Erik seeks to impact people's lives before he leaves. Contact Erik
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