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Nasdaq 100 technical analysis: Negative divergence continues to build

By Nathan Batchelor

Nasdaq 100 technical analysis indicates that the index should hit 9,800 before a larger correction to the downside occurs. A move below the 9,320 level should provoke a strong downward correction.

US 100 traders remain in dip-buying mode, as they continue to ignore any bearish news coming from the US economy and China.

Nasdaq 100 technical analysis highlights that both the lower and upper time frames show the presence of negative MACD price divergence, which could unfold at any time.

Nasdaq 100 medium-term price trend

The Nasdaq has continued to move to fresh all-time trading highs, with bulls quickly buying the short-lived dip below the 9,000 level at the start of the month.

Nasdaq 100 technical analysis shows that the index has recently pulled back slightly from an all-time price high, although the downward move is likely to be short-lived.

The daily time frame is showing that the index continues to advance towards the overall target of a bullish inverted head and shoulders pattern.

Looking at the overall size of the bullish pattern, the Nasdaq 100 is expected to rally towards the 9,800 level.

However, substantial amounts of negative price divergence exist on the daily time frame, and warn of steep downside correction once the bullish target is finally achieved.

Nasdaq 100 short-term price trend

Nasdaq 100 technical analysis shows that the index is still vulnerable to a decline towards the 9,100 support level.

The one-hour time frame is showing that bearish MACD divergence is extending down towards the 9,100 level.

Failure to make a new higher high could trigger the bearish correction to take place in rapid fashion.

Inline with the continuation of the broader bullish trend, a move above the 9,460 could propel the index to yet another high, around the 9,550 area.

A loss of the 9,320 level should be considered bearish in the short-term, and may accelerate losses towards 9,100.

Nasdaq 100 analysis suggests that the index is still on track to reach the 9,800 level. Bearish MACD divergence continues to warn of a large technical correction.

Nasdaq 100 technical summary

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