Nasdaq chart review
This week markets were cautiously grinding up in anticipation (or, let’s say on rumors) of positive developments of US-China talks. However, confusing US retail sales data yesterday and following mixed headlines on results of talks led to alarming declines in stock markets. There were reports that “high-level trade talks between the two delegations have come to an end with no immediate announcement to come from either side” – this is a quote from US government official.
It all ended up in risk-off mood continuing during today’s Asian session.
Risk tone has slightly improved by this time that I am writing this after Mnuchin’s meeting with Xi and media reports shining with renewed optimism.
Frankly it is all very funny and confusing for markets, up and down following every insignificant declaration of “hope and progress”.
Technically, looking at Daily chart we immediately spot that price is at a very significant level – 7050. If it overcomes this strong resistance, then the next leg up will be quick and likely to stop at 7130.
For me, however, more likely scenario is to enter short trade at current levels in anticipation of US opening. Price may try to rally but technicals indicate for sooner correction.
Now, I do not like to keep position open for the weekend and likely this is also going to be a case for many investors.
Sell at current levels and watch for the possible price break above 7050. As unlikely as it is, just keep a tight stops above 7070.
Have a nice weekend !