Nasdaq Futures Testing Support

Nasdaq-100 futures have backed off a bit from their recent all-time highs as markets have experienced some chop, but the /NQ was only down about -1.5% from that peak of 19,023.25 as of yesterday’s close. In today’s early trading, the contract is now near a previous set of highs from March near 18,709 as well as the 9-day Exponential Moving Average near 18,730 – a confluence that could be a key tipping point if it is breached.

There are some recent technical developments that look more geared toward downside price action as well. First, price recently broke an upward trendline beginning with the lows on May 2. The trendline was broken the same day Nvidia (NVDA) reported earnings, which pushed the market up into that fresh all-time high before seeing a sharp reversal shortly after the trading day opened. Additionally, an accompanying upward trendline on the Relative Strength Index (RSI) was broken around the same time. The RSI also showed slight bearish divergence as price made new closing highs on Tuesday, and yesterday made a new relative low while price did not follow suit. Both these situations lean more toward the bearish side. Finally, the ParabolicSAR, which traders use to assess trend direction and set stop-loss prices, is making a bearish crossover this morning.

The previously mentioned support confluence between about 18,709 and 18,730 could be important to watch. If price continues to deteriorate beyond that, look for potential support near the 21-day Exponential Moving Average currently near 18,514. Meanwhile, the area between the closing highs of 18,950.50 and the all-time intraday highs of 19,023.25 offers a possible resistance zone.