NAS100 Top-Down Analysis – 01 Dec ’21

  • NAS100

Weekly Chart

The NAS100 weekly chart retains its bullish bias. The shorter-term green moving average is above the mid-term orange moving average, and the mid-term orange moving average is above the longer-term red moving average. This is a bullish formation. Since shortly after the pandemic lows, the index stochastic has also oscillated around its 70th percentile (aqua rectangle), suggesting the presence of underlying bullish momentum. This matched with index appreciation (aqua trend line).

Past Performance: Past Performance is not an indicator of future results.

Daily Chart

The daily chart has pulled back from its 22 November high. The index found support around the 16,000 level (shaded blue horizontal). This is a key level given that the pullback moved the shorter-term green moving average below the mid-term orange moving average (aqua ellipse). However, the mid-term orange remains above the longer-term red moving average. This effectively has the daily time frame in a neutral formation. A bullish cross of the green above the orange will sync this timeframe with the longer weekly timeframe.

Past Performance: Past Performance is not an indicator of future results.

Hourly Chart

The NAS100 dropped heavily as Fed Chair Powell testified in front of the Senate Banking Committee. His comments and tone were distinctly hawkish, and the bond market responded with a jump in yields. These higher yields initially adversely affected the valuation metrics of the NAS100, given its growth nature. Nevertheless, the market action since then suggests a possible overreaction to the comments. The orange mid-term moving average has crossed above the longer-term red moving average, putting the moving averages back into bullish formation. If the red moving average turns up, this will be the next bullish development to support the weekly chart, and suggest a possible return to bullishness on the daily timeframe.

Past Performance: Past Performance is not an indicator of future results.

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Russell Shor

Senior Market Specialist

Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.


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