Nasdaq Composite Technical Analysis – Bulls and Bears are watching this support

<p>Last
week, the <a href="https://www.forexlive.com/news/forexlive-americas-fx-news-wrap-26-jul-fed-raises-rates-by-25-bps-to-55-22-year-high-20230726/">Fed hiked the interest rates by
25 bps</a> as widely expected keeping everything unchanged. Fed Chair Powell
reiterated their data dependency and kept all the options on the table. The
economic data since the FOMC meeting has been pretty solid and the labour
market indicators keep on running hot. This week we got a selloff that began
with the rating agency <a href="https://www.forexlive.com/news/fitch-downgrades-usa-long-term-credit-rating-to-aa-from-aaa-20230801/">Fitch downgrading US credit
rating</a> to AA+ from AAA and then extended further as the <a href="https://www.forexlive.com/news/adp-us-july-employment-324k-vs-189k-expected-20230802/">US ADP</a> report
came in hot again. </p><p>Nasdaq Composite Technical
Analysis – Daily Timeframe</p><p>On the daily chart, we can see that the Nasdaq
Composite is experiencing a deeper correction as it struggles to extend to the
14649 high. The price currently sits at the previous <a href="https://www.forexlive.com/Education/technical-analysis-polarity-20220408/">resistance turned support</a>, but the
sellers may be targeting the upward <a href="https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/">trendline</a> where
the buyers should step in more aggressively. </p><p>Nasdaq Composite Technical
Analysis – 4 hour Timeframe</p><p>On the 4 hour chart, we can see that we had a <a href="https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/">divergence</a> with the
<a href="https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/">MACD</a> on the
last leg higher which is generally a sign of weakening momentum often followed
by pullbacks or reversals. The buyers should pile in here around the 13885 <a href="https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/">support</a> where we
have also the <a href="https://www.forexlive.com/Education/technical-analysis-confluence-20220318/">confluence</a> with the
50% <a href="https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/">Fibonacci retracement</a>. The
sellers, on the other hand, should pile in more aggressively if the price
breaks lower and target the trendline first, and eventually the 13174 support. </p><p>Nasdaq Composite Technical
Analysis – 1 hour Timeframe</p><p>On the 1 hour chart, we can see more
closely the current bullish setup with the price that may even print a little
inverted <a href="https://www.forexlive.com/Education/chart-patterns-guide-20220125/">head and shoulders</a>
pattern right at the support. What happens here will probably lead to a big
move afterwards, so buyers and sellers will watch this level carefully after
the NFP report today. </p><p>Upcoming
Events</p><p>Today, all eyes will be on the <a href="https://www.forexlive.com/EconomicCalendar">US NFP</a>
report. The Fed will see another NFP report before the next meeting so this one
won’t decide what they are going to do but it can change market expectations,
nonetheless. It’s hard to see what the market is going to do with this data,
but a strong report should weigh on the Nasdaq Composite as the market would
expect the Fed to remain hawkish and weak readings are likely to cause a
selloff as the market may start to fear a recession on the horizon. The
technicals here should be more helpful to manage risk and position in line with
the flow. </p>

This article was written by FL Contributors at www.forexlive.com.