Nasdaq100 Futures Weighed Down by Robust U.S. Data

The Nasdaq100 Futures (CME: NQ) have recently faced a mixed trajectory, marked by both gains and losses. Despite recording its fifth week of losses for the year, the futures remain on an upward trend for five consecutive months, illustrating resilience amidst market fluctuations.  

The index futures initially rallied in response to the PCE Price Index meeting expectations at 2.5%, indicating stable inflation levels. However, this optimism was short-lived as upbeat U.S. manufacturing data triggered risk-off sentiment, recalibrating expectations of a rate cut in June.  

With the probability dropping from 63.8% to 56.8%, investors anticipate persistent price pressures amidst improving employment figures in the manufacturing sector, a major sector in the U.S. economy. As the week unfolds, market participants eagerly await key events, particularly the U.S. labour market reports, notably the Nonfarm Payrolls data, which could provide further insights into the economic landscape and influence Nasdaq100 Futures‘ trajectory. 


The recent price action of the Nasdaq100 Futures indicates a shift in sentiment favouring the downside, with the futures crossing below the critical 100-day moving average.  

Initially finding support at the 18053.25 level, the futures faced resistance at 18707.50, where overbought RSI conditions emerged, curbing further upside potential. Subsequently, a downturn ensued, with the futures declining and aligning with the 100-day moving average, signalling a short-term downtrend.  

In the current session, the futures broke below the 50% Fibonacci Retracement level, suggesting continued downside pressures. If this trend persists, the 61.80% Golden Ratio may serve as a significant point of interest to the downside. Conversely, a resurgence of upside momentum could lead to a retest of the 18707.50 resistance level.  


Amidst mixed performance, the Nasdaq100 Futures face downward pressure following robust U.S. data. Technical indicators suggest a short-term downtrend, with support at 18053.25 and resistance at 18707.50. Traders keenly await U.S. labour market reports to gauge future market direction amid evolving economic conditions. 

Sources: CME, Reuters, TradingView 

Piece Written By Nkosilathi Dube, Trive Financial Market Analyst 

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