NDX dominated by bears dragging the market lower throughout the day
Nasdaq 100 Index (NDX) Technical Analysis Report for Dec 02, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, NDX ended Monday at 8309.26 tanking $94.42 (-1.12%). This is the biggest single-day loss in over a month. The bears were in full control today, moving the market lower throughout the whole session. Closing below Friday's low at 8402.13, Nasdaq confirmed its breakout through the prior session low after trading up to $127.52 below it intraday.
Daily Candlestick Chart (NDX as at Dec 02, 2019):
Monday's trading range has been $135.26 (1.61%), that's far above the last trading month's daily average range of $56.29. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for NDX.
Three candlestick patterns are matching today's price action, the Bullish Hikkake Pattern which is known as bullish pattern and two bearish patterns, the Bearish Belt-hold and the Black Candle.
After trading as low as 8274.61 during the day, the market found support at the 20-day moving average at 8291.76. The last time this happened on August 22nd, NDX actually lost -3.15% on the following trading day. Prices broke below the key technical support level at 8357.80 (now R1), which is likely to act as resistance going forward.
While Nasdaq 100 is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Price broke through Technical Support S1" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Nasdaq 100. Out of 220 times, NDX closed higher 59.09% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 65.91% with an average market move of 0.90%.
With four out of the other six Major World Indices closing lower today, the ones that stand out on the negative side are DAX losing -2.05% and DJIA closing -0.96% lower. On the flipside the best performers have been NKY closing 1.01% higher and HSI gaining 0.37%. Read more