E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Ready to Test 12698.00 – 13082.50 Retracement Zone

September E-mini NASDAQ-100 Index futures are up sharply late in the session on Wednesday as investors bet the Federal Reserve would slow interest rate hikes following its announcement earlier of an increase in rates in line with expectations.

After the Fed raised its benchmark interest rate 75 basis points, Fed Chair Powell told reporters it will likely be appropriate to slow the pace of increases as rates get more restrictive and that the Fed want to get to moderately restrictive levels by year-end.

At 19:34 GMT, September E-mini NASDAQ-100 Index futures are trading 12674.25, up 561.75 or +4.64%. The Invesco QQQ Trust ETF (QQQ) is at $306.74, up $12.37 or +4.20%.

Bullish Sentiment Driven by Powell’s Dovish Tone

Powell also said a lack of visibility into the economy’s future trajectory means the Fed can only provide guidance on a “meeting by meeting” basis.

Powell’s comments sparked a late session buying spree as strategists pointed to his lack of guidance for a specific rate hike in September and his remarks that previous hikes would keep reducing inflation as potentially dovish signs.

In stock related news, the tech-heavy index was also boosted as better-than-feared quarterly reports from technology giants Microsoft and Alphabet supported risk sentiment.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 12698.50 will reaffirm the uptrend. A move through 12072 will change the main trend to down.

The short-term range is 14327.50 to 11068.50. The index is currently in a position to test its retracement zone at 12698.00 to 13082.50.

On the downside, the support is a minor pivot at 12088.75.

Daily Swing Chart Technical Forecast

Trader reaction to the short-term 50% level at 12698.00 is likely to determine the direction of the September E-mini NASDAQ-100 Index into the close on Wednesday.

Bullish Scenario

A sustained move over 12698.00 will indicate the presence of buyers. Taking out the main top at 12698.50 will reaffirm the uptrend with a main top at 12973.75 and a short-term Fibonacci level at 13082.50 the next targets. The latter is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 12698.00 will signal the presence of sellers. This could lead to an intraday pullback into a minor pivot at 12385.25. Followed by a support cluster at 12088.75 – 12072.00.