Some are born to lead and others to follow, and the NQ emini has once again regained its rightful place as leader of US equity markets, following a period when it has been lagging behind its two sisters. However, in last week’s volatile price action on the daily charts, it was the NQ which reinstated the bullish tone once again. Whilst both the ES emini and the YM emini remained firmly congested within the spread of the volatility candle of the 9th September, the NQ emini powered higher, and moved back to test the very strong resistance area in the 4816 area, that to date has capped further gains. Thursday’s price action was particularly impressive, with very high volume confirming participation of the big operators, and the wide spread up candle closing the session with a test of the resistance region denoted with the blue dotted line. What was also interesting was the volumes earlier in the week, and particularly those on Wednesday, which simply confirmed the lack of selling pressure and duly reinforced the following day.
At the same time as clearing the volatility candle, the index moved back above the volume point of control in the 4785 area, with Friday’s price action remaining contained as the markets await the big events this week of the FED and the BOJ. Should the FED fail to act, and any associated statement be perceived as dovish, this would almost certainly provide the springboard for a breach of the resistance region above, and take the NQ higher and out into new high ground, with the ES and the YM following behind and playing catch up once again.
By Anna Coulling
Charts from NinjaTrader and indicators from Quantum Trading