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Nasdaq 100 Breakout Failure of All-Time High

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Market Overview: NASDAQ 100 Emini Futures

The NASDAQ Emini futures week is a bear trend bar mostly reversing the big bull bar of last week. It signifies a breakout failure of all-time high.

On the daily chart, the market went sideways for a few days early in the week and then had bear trend days on Thursday and Friday, with Friday gapping down and being much bigger than Thursday and closing below the exponential moving average (EMA).

The monthly bar is a bull doji bar with a long tail above. There are two more weeks in the month. It is likely the month will end as a doji bar with tails above and below, possibly even an outside bar.

NASDAQ 100 Emini futures

The Weekly NASDAQ chart

Nasdaq Weekly Breakout Failure of All-Time High
  • The week is a bear trend bar, mostly reversing last week’s bull breakout bar.
  • Bulls needed a good follow-through bar this week.
  • Bears want a double-top with the July high and the breakout to fail and a move down to the August low.
  • Now bears need a good entry bar to convince traders there will be a second leg down.
  • One problem for the bears is the weekly EMA may act as support. But if bears get a good bear bar next week, they will likely get a 2nd leg down, even if there is a pullback.

The Daily NASDAQ chart

Nasdaq Daily Bull Breakout of EMA likely failing
  • It looks like the breakout of the EMA as shown in the chart is likely failing.
  • If the market gets below the low of the bull breakout bar of 11-6, then the Measured Move (MM) target has likely failed.
  • The big down, big up and big down this week will lead to confusion. There was likely going to be a 2nd leg up to the big move up last week, and there will likely be a 2nd leg down corresponding to the big move down this week. It will just not be clear till after the fact which came first.
  • Monday, Tuesday and Wednesday are small doji bear bars with prominent tails below, almost like a bull wedge flag. The wedge instead broke down on Thursday and Friday.
  • The Friday bar closed below the EMA and is big enough that there are likely sellers above. There were likely limit order buyers below the 11-7 bull bar who are now trapped. So those buyers will try to exit on a bounce.
  • Usually, big bars do not get follow-through so its more likely for early next week to be doji bars around Friday’s close, and then the market will decide whether to make a move up, or down.

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