NQ 2 hour analysis - rising wedge - February 7, 2021
NQ 2 hour analysis - The NQ (Nasdaq 100 futures) is at an interesting crossroads. Observe the rising wedge with bid line drawn from the January 31 low. Notice the negative (bear) divergence on the momentum indicator below.
Now look back to the previous rising wedge that topped out on January 26th. Notice the first (yellow arrow) top coinciding with the first negative (bear) divergence (yellow arrow). Observe that the NQ sold off for a day or so, then went back and tested the offer line again making a higher high (red arrow) on an even more negative divergence (red arrow) before selling off hard.
I think there are 3 possible scenarios:
1) The NQ sells off this week out of the rising wedge.
2) The NQ sells or consolidates a bit, then rallies up to test the fib extension (sideways red arrow), building an even bigger divergence like last time, before selling off hard.
3) The NQ melts higher up.
Let me know what you think will happen in the comments section below.
Now look back to the previous rising wedge that topped out on January 26th. Notice the first (yellow arrow) top coinciding with the first negative (bear) divergence (yellow arrow). Observe that the NQ sold off for a day or so, then went back and tested the offer line again making a higher high (red arrow) on an even more negative divergence (red arrow) before selling off hard.
I think there are 3 possible scenarios:
1) The NQ sells off this week out of the rising wedge.
2) The NQ sells or consolidates a bit, then rallies up to test the fib extension (sideways red arrow), building an even bigger divergence like last time, before selling off hard.
3) The NQ melts higher up.
Let me know what you think will happen in the comments section below.
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