Will we see a weekly bearish pivot with Nasdaq 100 ? If we did, how can it be interpreted ?
Prior to this, lets look at the major, medium and short term trends of Nasdaq 100 and try and read the anticipated bearish pivot within the context of those if we see one.
Major trend : Charging bull.
Medium term trend : Charging bull with a few question marks. I will explain below.
Short term trend : Charging bull despite the fact that we have an outside bar.
Lets focus on the medium term trend leading into the box of tricks in Red. Why ? In order to identify when and where the price starts mis-behaving first. How do we do this ? Focus on the rallies and reactions shown in Red and Blue which represent the medium term trend and try and identify the where and when this mis-behaving started. See the largest reaction/pullback in Red which defines the boundaries of my box of tricks. This is where alarm bells start ringing in the medium term. What happened after that ? Congestion.
It appears that this congestion resolved itself in the direction of the major trend as long as price keeps it’s head outside the box and preferably above the Orange support line within the box if the breakout was not a fake one. We will see ?
How can the public and that of some technical traders get excited about an instrument ? A new high perhaps ?
We have seen three new highs after the largest pullback which enabled me to draw my box of tricks. Where is the price now ? Not far from the broken resistance line of my box of tricks. I ask myself following: Where are the buyers if this instrument is making new highs to propel it higher ? Are rallies outpacing reactions in a meaningful way ? Are we seeing a potential distribution by the smarter lot ? In hindsight we will know the answers.
To the last couple of bars now. Penultimate bar was HH/HL bar. Current bar which may or may not complete the bearish pivot ( still in the last few minutes of trading Nasdaq 100) is a HH/LL ( an outside bar). A change in the short term to watch for even if we don’t see a simple bearish pivot.
Is the complex bearish pivot in the making ? This remains to be seen. Let’s give it a few more weeks and watch what may unfold. If we see one ( bearish complex pivot) let’s keep an eye on short term support levels and most importantly this level, 6164.43 ( low of the largest reaction).
I chose to analyse Nasdaq 100 not NDQ.ASX ETF which in my opinion gives us more insights than the ASX listed NDQ ETF.
I know, I talk about bars and show candles. Human nature is constant !
Chart is courtesy of StockCharts.com
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