NDX dominated by bears dragging the market lower throughout the day
Nasdaq 100 Index (NDX) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
NDX finished Wednesday at 11247.60 losing $191.27 (-1.67%). The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 11367.20, Nasdaq 100 confirmed its breakout through the prior session low after trading up to $124.24 below it intraday.
Daily Candlestick Chart (NDX as at Sep 16, 2020):
Wednesday's trading range has been $243.13 (2.12%), that's slightly below the last trading month's daily average range of $258.40. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for NDX.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical support level at 11055.16 (S1). After having been unable to move above 11495.40 in the previous session, the market ran into sellers again around the same price level today, failing to move higher than 11486.09. The last time this happened on August 25th, NDX actually gained 2.13% on the following trading day.
Although the index is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could accelerate should prices move above the nearby swing high at 11495.40 where further buy stops might get triggered. Further selling could move prices lower should the market test August's close-by low at 10855.06.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near low of period" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Nasdaq 100. Out of 435 times, NDX closed higher 60.00% 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 66.44% with an average market move of 1.22%.
With three of the other Major World Indices closing higher and three closing lower today, the winners of the day are DAX surging 0.29% and DJIA gaining 0.13%. On the flipside the worst performers have been SPX closing -0.46% lower and FTSE losing -0.44%. Read more