Nasdaq index analysis: key technical levels and trends to watch | Forexlive

The NASDAQ index has opened lower, but is seeing a modest bounce in early trading. The price action reflects the the ongoing tug-of-war between buyers and sellers.

• Monday’s Gap Higher: The index saw a notable gap higher on Monday, with prices moving up toward the 38.2% retracement level of the decline from the February high at 18338.54. However, the rally fell short on two separate occasions, indicating resistance at this (see chart above).

• Sharp Decline: Yesterday’s trading session witnessed a sharp fall, bringing the price back toward the 50-hour moving average (MA) at 17846.26 (black moving average line on the chart above). The price stalled at this level, highlighting its significance as a short-term support.

• Early Trading Today: In early trading today, the price has dipped below the 50-hour MA but remained above the 100-hour MA, currently at 17747.07. This moving average is critical; a move below the 100-hour MA could signal increased control for sellers, potentially leading to further downside.

• Buyers Under Pressure: If the price holds above the 100-hour MA, buyers remain in play but still under pressure. To alleviate this pressure, the price would need to break above the swing area between 17917.54 and 18030.68 (see red numbered circles and yellow area). A break above that level could pave the way for renewed bullish momentum on the inability to move below the 100 hour moving average recall that in last week’s trading that 100 hour moving average did find willing sellers (follow the blue line on the chart above).

• Work to do:.Ultimately, if the buyers are to take more control, they need to get and stay above the 38.2% retracement at 18338.54. The 200 hour moving average of 18464.00 and moving lower is another work in progress that would need to be broken to increase the bullish bias

The break below the 50-hour moving average is now seeing price action above and below that moving average level as traders debate going lower or buying the dips. If the price can stay above that level and start to make progress on the upside targets the buyers can take back control. Absent that, and the corrective move higher was just a plain-vanilla correction and what has been a bearish market for the index released in the short/medium term.