Will the Nasdaq100 Futures Test April Highs?

Traders of the Nasdaq100 Futures (CME: NQ) are currently witnessing a buoyant market sentiment, marked by back-to-back weeks of gains.  

Last week’s positive closure not only affirmed the upward trend but also set the stage for further optimism, with the index futures surging 1% higher this week. A three-day streak of gains indicates a robust positive trajectory amidst recent softer-than-anticipated US jobs data.  

The subdued employment figures have reignited speculation around potential Federal Reserve intervention through interest rate cuts this year. Traders are seemingly capitalising on this scenario, leveraging the wave of softer job statistics to navigate market fluctuations. As the economic calendar lacks substantial data releases, attention is diverted towards earnings reports as we approach the conclusion of earnings season. Furthermore, the forthcoming speeches by Federal Reserve members add an additional factor to consider, potentially offering insights into the central bank’s monetary policy outlook.  


The Nasdaq100 Futures have recently embarked on an impressive upward trajectory, marking a notable shift in sentiment as it surpassed the 100-day moving average, indicating a tilt towards bullish sentiment.  

This upward momentum was catalysed by a rebound from support at the 17386.25 level, propelled by oversold Relative Strength Index (RSI) conditions, suggesting a potential reversal from the oversold region. 

Amidst this ascent, the index futures managed to break through a significant swing high formed under intense selling pressures. Currently, the focus potentially lies on breaching the 18350.75 resistance level established during the mid-April selling spree. However, despite the prevailing upward momentum, volumes on the upside have somewhat dwindled, reflecting overbought RSI conditions. Should downward pressures resurface, market participants may eye the 100-day moving average as a critical level of interest to the downside. Conversely, if the bullish momentum persists, a retest of the 18350.75 resistance level remains plausible.  


With consecutive weeks of gains and bullish sentiment prevailing, the Nasdaq100 Futures are poised for potential breakthroughs, eyeing the critical 18350.75 resistance level. Traders navigate softer job data and anticipate Federal Reserve cues, while technical indicators hint at a possible reversal from oversold conditions. 

Sources: Reuters, TradingView 

Piece Written By Nkosilathi Dube, Trive Financial Market Analyst 

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