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Trading around the earnings season is always a particular task as all participants have to incorporate expectations, past results, and options into a single data release (especially as most earnings are reported out of the trading hours).
This morning's open saw a huge correction in the Nasdaq 100 particularly, showing down 1.02% in the first 30m Candle and some dip buyers are currently stepping in.
The Tech-focused index had marked another all-time high record in yesterday's morning session at 23,288 (CFD price – actual index ATH at 23,264) before retracting in the afternoon.
Equity traders are eyeing Earnings reports from SAP after the close today, but more importantly preparing for tomorrow's AT&T pre-open's reports and even-more market moving, Google (NASDAQ:GOOGL) and Tesla (NASDAQ:TSLA) earnings after the close.
Some investors will be inclined into reducing some of their tech-positions as Market is already heavily positioned, potentially missing some few potential returns to avoid losing more in the scenario of bad earnings – NVIDIA (NASDAQ:NVDA) is down about 3% on the session and Google is down -0.60%.
For traders, any volatility is good to generate opportunities, and the most short-term participants may still enjoy from this to trade.
Let's take a look at the Nasdaq charts to spot the levels of interest.
Nasdaq Multi-Timeframe Analysis Starting From Intraday to the Longer-Outlook
Nasdaq 30m Chart
Source: TradingView
As mentioned in the introduction, the Nasdaq has seen some steep profit-taking in the first 30m taking the index form way overbought to way oversold.
Some dip buyers are stepping in, bringing the index between its 30m 50 (resistance at 23,195) and 200 (support, at 23,070) Moving averages.
Watch for reactions around the middle of the 30m upwards channel that took the NQ to its new all-time highs, level located around 23,150.
Nasdaq 100 4h Chart
Source: TradingView
Taking a step back allows us to see how strong that move towards almost daily new all-time highs has been – The RSI Momentum is correcting after today's selloff but is struggling to go beyond the neutral line (middle line of the indicator).
Any break of this middle RSI line accompanied by a close below the 50 period 4H MA should trigger some further profit taking.
In the meantime, buyers have defended the low of the immediate channel.
Interesting to see some reactions such as the intermediate top at the Fib Extension target mentioned in our post-NFP analysis which you can find here – Let's see if traders manage to break this current roof or fail to do so in the rest of the week.
In the waiting of the key earnings tomorrow & the US ISM data on Thursday, there is still some time for movement.
Levels to place on your charts:
Support Levels:
- Intraday Support (23,050 to 23,070 low of channel and 30m MA 200)
- Pivot turned support – 22,700 Region
- Previous ATH Support Zone 22,000, 50 Day MA at 22,050
Resistance Levels:
- Intraday resistance at 23,195
- Current all-time highs 23,288 (CFD – Index at 23,264)
- Fib-Extension Resistance zone between 23,250 to 23,500
Nasdaq Daily Chart
Source: TradingView
The Daily chart shows how the Tech-focused index is evolving swiftly, showing some decent demarkation from its 1,000 points-below early 2025 ATH (was at 22,229 on its CFD).
Markets are trading in the upper bound of the higher timeframe Upwards channel and Daily momentum seems to be stalling a bit, but still just below the overbought zone and not showing signs of major divergence.
Safe Trades!