NASDAQ-100 Testing Lower End of Major Retracement Zone

March E-mini NASDAQ-100 Index futures are trading lower late in the session on Thursday with prices supported early in the session by positive economic news, but pressured throughout the session by mixed corporate earnings, geopolitical unrest and the prospect of a more hawkish Federal Reserve.

At 21:12 GMT, March E-mini NASDAQ-100 Index futures are trading 13969.50, down 189.00 or -1.33%. The Invesco QQQ Trust Series 1 ETF (QQQ) settled at $341.10, down $3.47 or -1.01%.

In stock-related news, shares of Tesla Inc dropped after the company warned that supply issues will last throughout 2022. Meanwhile, Netflix Inc jumped following news that billionaire investor William Ackman has amassed a new $1 billion stake in the company.

Traders should brace for early volatility on Friday with Apple Inc expected to release its earnings report after the cash market close.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since the confirmation of Monday’s closing price reversal bottom.

A trade through 13706.00 will negate the chart pattern and signal a resumption of the downtrend. A move through 16009.25 will change the main trend to up.

The minor trend is also down. A trade through 14639.75 will change the minor trend to up. This will confirm the shift in momentum.

The index is currently straddling the lower level of a major retracement zone at 14515.75 to 13984.25.

The minor range is 16009.25 to 13706.00. If the minor trend changes to up then its pivot at 14857.75 will become the primary upside target.

The short-term range is 16659.50 to 13706.00. Its retracement zone at 15182.75 to 15531.25 is the next major resistance target.

Short-Term Outlook

The direction of the March E-mini NASDAQ-100 Index into the close on Thursday is likely to be determined by trader reaction to 13984.25.

Bearish Scenario

A sustained move under 13984.25 will indicate the presence of sellers. This could trigger a break into 13706.00 late Thursday or early Friday.

A failure to hold 13706.00 will indicate the selling pressure is getting stronger with 12968.00 the next major target.

Bullish Scenario

A sustained move over 13984.25 will indicate the presence of buyers. They are trying to defend this week’s bottom. If successful, this could trigger an acceleration into 14515.75, followed closely by 14639.75.

Don’t look for any meaningful short-covering rally to start unless buyers can overcome the minor top at 14639.75.