NASDAQ 100 Futures at $19,175 Amid US Economic Data and Geopolitical Tensions

The Nasdaq-100, known for its tech-heavy composition, has experienced a notable bullish performance this year, driven by remarkable rallies in major tech companies. These giants have pushed the index higher, benefiting from growing investor interest in artificial intelligence (AI) and other advanced technologies.

Robust earnings reports and optimistic outlooks from these companies have further fueled the upward momentum. However, this surge has sparked concerns over potentially stretched valuations, leading to some volatility in recent weeks.

US Economic Data and Fed’s Interest Rate Stance Shape Nasdaq-100 Outlook

On the US front, economic data and the Federal Reserve’s stance on interest rates significantly impact the Nasdaq-100. Investors closely monitor the Fed’s monetary policy decisions for clues about future rate cuts. The economy grew at a 2.8% annualized rate in the April-June period, surpassing the previous quarter’s 1.4% and the expected 2%.

The core Personal Consumption Expenditures Price Index, the Federal Reserve’s preferred inflation measure, slowed to 2.9% from 3.7% in the first quarter.

Additionally, the number of unemployment claims fell to 235,000, indicating economic resilience. This positive economic data cheered investors, boosting the market. The markets have fully priced in a September Fed rate cut and anticipate two more cuts by year-end, which has kept the US Dollar weak.

This economic stability and anticipation of rate cuts have been supportive of the tech-heavy Nasdaq-100, which could benefit from a favourable interest rate environment and strong investor sentiment.

Increasing Geopolitical Tensions Impacting Nasdaq-100 Amid Israel-Gaza-Lebanon Conflict

On the geopolitical front, tensions, particularly those involving Israel, Gaza, and Lebanon, are adding uncertainty to the market. In the past 24 hours, Gaza’s Health Ministry reported 66 deaths and 241 injuries, including 36 killed and 120 injured at a school in Deir el-Balah. Israel bombed areas in south and east Lebanon, accusing Hezbollah of firing a rocket that killed 12 Druze people in the Golan Heights. Hezbollah denied the attack. So far, 39,324 people have died and 90,830 have been injured in Israel’s war on Gaza.
Hence, the geopolitical tensions involving Israel, Gaza, and Lebanon create market uncertainty, driving investors to safer assets and negatively impacting the performance of the tech-heavy Nasdaq-100.

NASDAQ 100 Price Forecast

The NASDAQ 100 E-mini Futures is currently trading at $19,175.75, showing a slight movement of +0.50. On the 2-hour chart, the pivot point is set at $19,313.25, serving as a critical marker for potential market movements. Immediate resistance is observed at $19,300, with further resistance levels at $19,411 and $19,613. On the downside, immediate support is noted at $18,892, followed by $18,656 and $18,456.

The Relative Strength Index (RSI) is at 39, indicating a bearish sentiment. The 50-day Exponential Moving Average (EMA) is positioned at $19,411.12, reinforcing the bearish outlook as the current price is trading below this level.

A double-top pattern is extending resistance near the $19,300 level, and the formation of a downward channel is also likely to limit upward movement. This technical setup suggests a bearish bias below the $19,300 mark.

In conclusion, the technical outlook for NASDAQ 100 E-mini Futures remains bearish below the $19,300 level. Traders should consider selling below this level, as maintaining below the pivot point could lead to further downward movement towards the support levels of $18,892 and $18,656.

Conversely, a break above the pivot point may indicate potential upward pressure.