Nasdaq 100: 8940 key resistance almost met, at risk of multi-week corrective decline

High-flying Nasdaq 100 now at risk of kick starting a multi-week corrective decline sequence.

Medium-term technical outlook on Nasdaq 100 (US Tech 100)

click to enlarge charts

Key Levels (1 to 3 weeks)

Pivot (key resistance): 8940

Supports: 8550/500 & 8250/180

Next resistance: 9170

Directional Bias (1 to 3 weeks)

In our previous report on the US Tech 100 (proxy for Nasdaq 100 futures) dated on 12 Dec 2019 (click here for a recap), the Index has rallied as expected and met the upside target/resistance of 8720 (printed a current intraday fresh all-time of 8889 in today’s Asia session). Interestingly, the latest push up is just a whisker away from a major resistance of 8940.

Flip to a bearish bias below 8940 pivotal resistance for a potential multi-week corrective decline sequence to target the next supports at 8550/500 and 8250/180 within a major uptrend.

On the other hand, a clearance with a daily close above 8940 invalidates the bearish scenario for the “high-flying Index” to reinsert its bullish tone for another push up to target 9170 (1.00 Fibonacci expansion of up move from 03 Oct 2019 low to 28 Nov 2019 high projected from 03 Dec 2019 low).

Key elements

  • The recent rally from 03 Dec 2019 swing low of 8165 has reached the upper boundary of the ascending channel in place since 03 Oct 2019 and confluences with a major resistance of 8940 that is defined by a Fibonacci expansion cluster.
  • The daily RSI oscillator has started to shape a bearish divergence signal after it has met an extreme overbought level of 80. This observation suggests the medium-term upside momentum of price action has abated.
  • Elliot Wave/fractal analysis has indicated that the recent medium-term upleg phase from 03 Oct 2019 low of 7461 has completed a 5-wave impulsive sequence with a potential end target set at 8930 (0.764 Fibonacci expansion from 03 Oct 2019 low to 28 Nov 2019 high projected from 03 Dec 2019 low). Thus, it may now kick start a corrective decline to retrace the gains of aforementioned medium-term upleg phase.

Charts are from City Index Advantage TraderPro


This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit for the complete Risk Disclosure Statement.

Important Notice:

Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.