It looks like the trend is still our friend on this one, fellas!
Will buyers keep defending this support zone on the Nasdaq 100 index?
Nasdaq 100 (NDX): 1-hour
Nasdaq 100 (NDX) 1-hour Chart by TradingView
Check out this area of interest holdin’ like a boss on the hourly time frame!
Not only does it line up with a short-term rising trend line that’s been holding since the start of the year, but it also coincides neatly with the 100 SMA dynamic inflection point.
What are technical indicators saying?
The 100 SMA is safely above the 200 SMA, confirming that the path of least resistance is to the upside. In other words, there’s a strong chance the rally could carry on from here.
Just be careful since Stochastic is already dipping into the overbought region to reflect exhaustion among buyers, so turning lower might lead to a quick dip.
Also, don’t forget that Uncle Sam has the CPI readings lined up today, which means we might see a lot of volatility in U.S. markets again.
Remember how the surprisingly strong January NFP spurred a sharp dollar rally that lasted well until the following trading week?
Number crunchers are expecting to see a 0.5% rebound from the headline CPI while the core version of the report might show a slightly faster 0.4% gain compared the previous 0.3% uptick.
However, the year-over-year CPI reading is projected to have fallen from 6.5% to 6.2% for January, which might still cast doubts on the Fed’s hawkish views. If that’s the case, risk assets like equities could take advantage and extend their gains!
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