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Lower Black Long-Term Uptrend Line: This line connects the lows since September, serving as the primary support for the index.
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Shorter-Term Upper Black Downtrend Line: This line connects the highs since the beginning of November, forming a clear descending resistance.
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Psychological Barrier of 21,000: Marked in blue, this horizontal level acts as a key resistance, coinciding with the upper boundary of a triangle formation.
At present, NASDAQ is battling two resistances simultaneously: the upper black downtrend line and the blue horizontal resistance. This confluence of levels creates a critical juncture where the market must decide its next major move.
Bearish Outlook:
As long as NASDAQ remains below these resistances, sellers have the upper hand. A failure to break higher could lead to a downswing and a retest of the long-term uptrend line. This would align with a short-term bearish sentiment, particularly if the market remains under the influence of technical pressures.
Bullish Potential:
December historically favors stocks, and Donald Trump’s bullish sentiment on markets could also add upward pressure. A daily close above the blue horizontal resistance and the black downtrend line would confirm a breakout. Such a move would signal a long-term buy opportunity, potentially driving the index to new highs.
This week will likely set the tone, with traders poised for either a decisive breakout or a continuation of the consolidation within the triangle.