Don't Ignore This Chart!

NASDAQ 100 Faces Major Support Test This Afternoon

Tom Bowley

Tom Bowley

Chief Market Strategist, EarningsBeats.com

The European Central Bank (ECB) announced its latest quantitative easing measures and though they initially moved global markets higher, the focus now seems to have turned to ECB President Draghi's comment that further interest rate cuts aren't likely.  There is weakness across the board in the U.S. after a 30 minute boost propped up prices after today's opening bell.  It's been a steady decline since, however, and the NASDAQ 100 ($NDX) is currently facing a stiff moving average test at the rising 20 day EMA.  The NDX hasn't closed beneath that moving average at any point over the past three weeks.  Take a look:


The red arrows mark key price resistance and show the latest failed attempt at a breakout.  The bears defended a key level.  Now it's the bulls' turn.  Momentum has been surging to the upside during the last month's rally and the rising 20 day EMA has been holding during short-term bouts of selling.  Will it hold again?

Happy trading!

Tom

Tom Bowley
About the author: is the Chief Market Strategist of EarningsBeats.com, a company providing a research and educational platform for both investment professionals and individual investors. Tom writes a comprehensive Daily Market Report (DMR), providing guidance to EB.com members every day that the stock market is open. Tom has contributed technical expertise here at StockCharts.com since 2006 and has a fundamental background in public accounting as well, blending a unique skill set to approach the U.S. stock market. Learn More