Short-term technical outlook on US Tech 100 (Thurs, 12 Jul)
Key technical elements
- The US Tech 100 Index (proxy for the Nasdaq 100 futures) is the best performing benchmark among the 4 main U.S. stock indices where it has staged a year to date gain of 12.63% as at 11 Jul 2018 U.S. closing session versus the performance of the rest as per recorded in the same YTD period (S&P 500 = 3.39%, Dow Jones Industrial = -0.44%, Russell 2000 = 9.57%).
- Graphical elements in conjunction with momentum indicators and Elliot Wave/fractal analysis are still constructive on the Nasdaq 100 to shape another potential upleg.
- Elliot Wave/fractal analysis suggests that the Index is now undergoing a potential intermediate degree bullish impulsive wave 5/ in place since 29 Jun 2018 low of 6935 to end the primary degree impulsive wave (5) of the “melt-up phase” that started in Feb 2016 low of 3888. Thereafter, the Index faces the risk of a multi-month corrective decline in the firs step within a potential multi-year bear market condition to retrace the 9-year cyclical uptrend from Mar 2009 low.
- The key short-term support rests at 7186 which is defined by the 11 Jul 2018 minor swing low area and the 38.2% Fibonacci retracement of the recent up move from 04 Jul 2018 low to 10 Jul 2018 high of 7316.
- The hourly Stochastic oscillator still has room for further potential downside before it reaches its oversold region which suggests that the Index may shape a minor pull-back to retest the 7232 intermediate support (the minor ascending channel support from 05 Jul 2018 low & yesterday, 11 Jul U.S. session minor swing low).
Key Levels (1 to 3 days)
Intermediate support: 7232
Pivot (key support): 7186
Resistances: 7330 & 7400
Next support: 7100/7080 (key medium-term pivot)
Therefore as long as the 7186 key short-term pivotal support holds, the Index is likely to shape another potential upleg to retest the current all-time high area of 7330 printed on 21 Jun 2018 before targeting the next resistance at 7400 (psychological & a Fibonacci projection cluster).
On the flipside, failure to hold at 7186 put the bulls on hold for a deeper pull-back to test the 7100/7080 key medium-term pivotal support (the lower boundary of the ascending channel from 04 Apr 2018 low & former swing high area of 27 Jun/03 Jul 2018).
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