Deeper Technical Breakdown and Key Levels:
The Nasdaq’s 4-Day SwingArm chart reveals a structured bullish trend with dynamic support and resistance levels that traders can monitor closely. Here is a more detailed clarification of these key levels and technical components:
Immediate Support: 4D Extreme Buyer Zone 28/5
This level is prominently marked on the chart where price has bounced several times in the past.
The Extreme Buyer Zone acts as a dynamic support, offering high-probability buy signals during retracements. If price revisits this zone, it could trigger renewed buying interest.
Key observation: Historically, Nasdaq has rebounded sharply from these zones, making them crucial for confirming bullish continuation.
Potential Scenario:
If Nasdaq retraces to this zone and buying pressure emerges, we could see a higher low, affirming the bullish trend.
Dynamic SwingArm Zones:
The layered SwingArm zones are acting as step-like supports for the price:
Primary SwingArm Zones: These levels follow price closely and adapt dynamically, showing where minor retracements could hold.
Major Trend Supports: Located far below current price action, these zones serve as “last defense” supports in case of severe corrections.
Levels of Interest:
Immediate SwingArm Zones:
First Dynamic Zone: ~19,200-19,400
Lower Dynamic Zone: ~18,700
Major Trend Supports (if a deeper drop occurs):
16,761 and 15,712 – noted as major swing levels in the chart.
These zones are critical because they act as potential bounce points for a continuation of the bullish trend.
Price at All-Time Highs – Key Resistance Levels:
At all-time highs, the market enters price discovery mode, where buyers and sellers find new equilibrium:
The absence of historical resistance allows price to move freely but also increases volatility.
Look for extensions above the current high (21,200+) using tools such as Fibonacci or measured moves.
Signs of Reversal or Weakness:
To identify risk of a trend reversal, monitor:
Failure at SwingArm Zones: If price breaks below the nearest extreme buyer zone without a sharp bounce, it signals weakening buying interest.
Bearish Divergence: Check momentum indicators (like RSI or MACD) for divergence against price action.
Break of Trendline Support: A confirmed break (with strong volume) of the blue trendline could trigger deeper pullbacks to test Major Trend Supports.
Risk Management Strategy:
Given the elevated levels:
Monitor price reactions at the 4D Extreme Buyer Zone and rising trendline. These are high-probability support areas.
A stop-loss just below the extreme buyer zones could protect trades against sudden downside.
Trailing Stops: As price makes higher highs, trailing stops below recent SwingArm zones can lock in profits.
Summary of Key Levels:
Immediate Support:
4D Extreme Buyer Zone ~ 18,700-19,000
Trendline Support:
Blue upward trendline around ~19,000.
Lower Major Supports (if drop accelerates):
16,761 (Major SwingArm Zone)
15,712 (Deeper support).
Resistance at All-Time Highs:
Monitor extensions above 21,200+.
Fibonacci Extension Projections for Upside Targets
To identify potential upside targets from the current all-time high levels, Fibonacci extension levels are applied. The extensions are measured from the last significant swing low to the previous major high, and retracement support levels.
Key Fibonacci Extension Levels:
100% Extension (Measured Move):
This projects a target equal to the previous bullish move.Target: 22,050
1.272 Fibonacci Extension:
A common extension used in trending markets that continues with strong momentum.Target: 22,550 – 22,600
1.618 Fibonacci Extension (Golden Extension):
This level often represents a stronger rally continuation in a highly bullish market.Target: 23,300 – 23,400
2.0 Fibonacci Extension:
A significant target for extended bullish breakouts where trend continuation remains aggressive.Target: 24,200 – 24,300
Potential Pathway to These Targets:
Momentum Confirmation:
The price must remain above the Extreme Buyer Zone (~19,000) and trendline support to maintain bullish momentum.Key Resistance Break:
If price clears 21,200 convincingly, expect upward acceleration towards Fibonacci extension targets.Volume Analysis:
Higher volume at breakout levels confirms sustained buying pressure and reduces false breakout risks.
Caution on Pullbacks:
While the Fibonacci targets signal potential upside, risk remains:
A failure to hold the trendline or a reversal at the current high could lead to retests of lower SwingArm zones (e.g., 18,700 or even 16,761).
Be prepared for pullbacks before further continuation to higher extensions.
Summary of Fibonacci Upside Levels:
100% Extension: 22,050
1.272 Extension: 22,550 – 22,600
1.618 Extension (Golden): 23,300 – 23,400
2.0 Extension: 24,200 – 24,300