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E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Needs to Close Above 10727.50

September E-mini NASDAQ-100 index futures hit an all-time high shortly after the mid-session on Friday. The mostly technology stock index is gaining support on two fronts. Some investors are buying because they believe in a V-shaped recovery, and other buyers are betting on stocks that will benefit from another prolonged lockdown. It seems when there is a slowdown in the buying, it is in reaction to positive news about a COVID-19 vaccine.

At 18:35 GMT, September E-mini NASDAQ-100 index futures are trading 10758, up 30.50 or +0.28%.

The latter occurred earlier in the session on Friday after Gilead Sciences said its coronavirus treatment candidate, remdesivir, “was associated with an improvement in clinical recovery and a 62 percent reduction in the risk of mortality compared with standard of care.” The ness sent Gilead shares up more than 1%. The rally in the index slowed on news as some investors decided to cash in.

Investors this week have flocked into mega-cap tech names such as Amazon, Microsoft, Netflix and Apple amid fears this latest resurgence in coronavirus could lead to people staying home for longer. All four of these stocks are trading at, or near all-time highs. They are also up at least 3.9% each week to date.

Daily September E-mini NASDAQ-100 Index
Daily September E-mini NASDAQ-100 Index

Daily Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed by today’s higher-high. The main trend will change to down on a move through 9728.75.

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A change in trend is unlikely at this time, but due to the prolonged move up in terms of price and time, we have to keep watching for a closing price reversal top. This won’t change the trend to down, but it will be one of the earlier indications that the selling is greater than the buying at current price levels.

The minor trend is also up. A trade through 10505.25 will change the minor trend to down. This will also shift momentum to the downside.

Based on the current upswing of 9728.75 to 10776.75, the nearest support is its retracement zone at 10252.75 to 10129.00.

Short-Term Outlook

The key level to watch into the close on Friday is 10727.50. A close below this level will form a closing price reversal top. If confirmed next week, this could trigger the start of a 2 to 3 day correction into at least 10252.75.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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