Yesterday, the Nasdaq Composite erased the CPI drop and rallied back to the cycle highs. This move came despite the market pricing in less rate cuts than the Fed’s Dot Plot and with some investment banks looking for just one cut in 2024. The market seems to be confirming that as long as the economy remains resilient and we don’t get extra hikes, we can keep on climbing to new highs.
Nasdaq Composite Technical Analysis – Daily Timeframe
On the daily chart, we can see that the Nasdaq Composite has been consolidating around the 16206 level for over a month and despite another hot US CPI, the price couldn’t make new lows. This could be a signal that the market is more likely to break to the upside and print new all-time highs.
Nasdaq Composite Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price rallied back to the cycle highs yesterday with the market threatening a breakout. The sellers might try one last time to step in here with a defined risk above the highs to position for a drop into the 15929 level. The buyers, on the other hand, will want to see the price breaking higher to increase the bullish bets into new highs.
Nasdaq Composite Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the price yesterday broke above the counter-trendline and triggered a stronger rally as the buyers piled in more aggressively into new highs. From a risk management perspective, the buyers will have a better risk to reward setup around the 16340 level where they will find the confluence of the blue 8 moving average and the 38.2% Fibonacci retracement level. The sellers, on the other hand, will want to see the price breaking lower to increase the bearish bets into the 15929 level.
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Today we conclude the week with the University of Michigan Consumer Sentiment survey.
