InvestingLive.com provides valuable insights into Nasdaq futures by analyzing order flow data from the last five days and the recent premarket hours. While their AI can help guide decisions, personal research is highly recommended. In the past five days, Nasdaq futures began with a bearish trend, experienced three bullish sessions, and then slowed down. On August 5th, the market showed slight bearishness, with resistance at highs and support at lows. From August 6th to 8th, it closed higher, showing that buyers were resilient against downturns. However, on August 11th, momentum slowed, meeting significant selling pressure at 23,800.

Pre-Market Dynamics

During pre-market hours, buyers initially defended prices but faced aggressive selling later. By mid-morning, buyers were firm at 23,630–23,643. However, late pre-market activity saw resistance at 23,664, limiting upward movement. Key levels for Nasdaq futures are support at 23,630–23,643 and resistance at 23,664. Upside targets range from 23,686 to 23,763. The price outlook is mildly bullish, rated at +3. A rise above 23,664 may lead to further increases, while a drop below 23,630 could indicate lower levels. Order flow is crucial as it reveals market transactions and the balance between buyers and sellers. InvestingLive utilizes this information to spot market shifts, giving traders an edge without providing direct financial advice. They also share more insights through a free Telegram channel. We believe the Nasdaq shows an upward structure but is currently facing a tough challenge. After a strong rally last week, momentum has slowed. Sellers have created a tough ceiling around 23,800. The key battleground is at 23,630 for buyer support and 23,664 for seller resistance.

Economic Backdrop

This market tension exists amid positive economic data. The latest Consumer Price Index (CPI) report from July showed inflation cooling to 3.1%. This eases pressure on the Federal Reserve to make aggressive policy changes, generally benefiting tech stocks. The labor market also shows signs of balance, reinforcing positive sentiment. The non-farm payrolls report from July, released on August 1st, indicated a moderation in hiring to 190,000 jobs, alleviating fears of an overheating economy. This suggests a favorable “goldilocks” environment for traders in the near term. With the trading range tightening, traders might explore strategies that profit from low volatility, such as selling out-of-the-money call and put options. An iron condor strategy could work well if the Nasdaq remains steady between key support and resistance levels. This approach allows traders to earn premiums while awaiting the market’s next direction. Market volatility mirrors this calm. The CBOE Volatility Index (VIX) currently hovers around 14.5, a notable drop from above 18 levels during past market jitters in August 2024. With lower implied volatility, buying protective put options as a hedge against a drop below 23,630 is more cost-effective than it was a year ago. For those anticipating a breakout, a consistent move above 23,664 would signal an opportunity to act. Traders could then consider buying call options or implementing bull call spreads to target resistance levels around 23,735 and 23,763. On the other hand, if 23,630 support is broken, bearish strategies could target 23,600. Looking ahead to the following weeks, all attention will be on the Federal Reserve’s next meeting in September. Traders should be aware of options expiration dates and anticipate increased volatility as the meeting approaches. The current stability may just be a calm before a significant market shift. Create your live VT Markets account and start trading now.

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