Nasdaq – end of year showdown
The week continues as a nightmare for stock markets. The main thing is it the end of year and it is time for redemption and start of reporting for hedge funds. So, both these factors stimulate selling and declining markets encourage funds to close positions and move to cash.
At the same time, stock market are on oversold levels and it stimulates altos and some investors to enter longs. And another factor is the negative economic forecasts for 2019.
For this week, tomorrow’s FOMC and Fed headlines will be key. Only few trading days is left till end of year and whether there will be another round of sell-off or bounce will eventually happen is the biggest question.
Technically, H4 chart looks oversold and price is in buy area. But I would be very cautious to buy, as any rally attempt looks like short-lived and will eventually face clusters of serious resistance levels.
I would instead wait for the price bounce and sell from 6555 and especially from 6680 area. This is an area with much selling pressure. Another level to scale into short position is 6760. Again, no trade is sure thing, we are talking about probabilities here.
Have a nice day and safe trades !