The Nasdaq Composite and Nasdaq 100 are sharply higher in trading today, with both indices breaking above important technical resistance.
- Nasdaq Composite: Up around 1.5%
- Nasdaq 100: Up 600 points, or 2.0%, at 30,245 as of 10:36 AM ET
The gains are impressive, but the technical question now is whether the indices can remain above their respective breakout areas. If they can, buyers retain control and can target the next major highs. If prices fall back below those areas, today’s breakouts could quickly lose credibility.
Nasdaq Composite breaks above its swing area
The Nasdaq Composite gapped higher into a key swing area between 26,676 and 26,856. Buyers subsequently pushed the index through the top of that zone, with the price currently trading near 26,922.
That breakout puts buyers firmly in control.
That resistance zone between 26,676 and 26,856 now becomes the first support area. As long as the index remains above that zone—and particularly above its lower boundary at 26,676—buyers have the technical advantage.
The next major target is the all-time high at 27,190.21. A break above that level would move the Nasdaq Composite into new record territory.
Conversely, a move back below 26,676 would disappoint buyers looking for additional upside after today’s breakout. It would also raise the possibility that the move above resistance was a failed break.
If the price falls below 26,676 and stays below it, traders would begin looking back toward the rising 100-hour and 200-hour moving averages between approximately 26,300 and 26,345.
Nasdaq Composite key technical levels
- Current price: Around 26,922
- Immediate support:26,856
- Key support zone:26,676 to 26,856
- Bullish target: All-time high at 27,190.21
- Deeper support: 100-hour and 200-hour moving averages between 26,300 and 26,345
Nasdaq 100 extends above the August high
The Nasdaq 100 also gapped sharply higher and moved above its swing area between 29,669 and 29,946.
The buying momentum then carried the index through the August swing high at 30,195 (the high reached 30255.15). The price is currently trading around 30,245, up approximately 600 points, or 2.0%.
Moving above the August high is another bullish technical development. It clears a visible resistance level and opens the door for a move toward the June highs between 30,587 and 30,762 (the all time high price).
That area represents the next major upside test. Buyers would need to get above 30,762 and stay above it to confirm another bullish breakout.
On the downside, the first close-risk area is the former swing zone between 29,669 and 29,946. As long as the price remains above that zone, buyers remain in firm control.
A move below 29,946 would be the first warning sign, while a break below 29,669 would weaken the bullish structure and shift attention back toward the hourly moving averages.
The 200-hour moving average is near 29,427, while the 100-hour moving average is near 29,320. Those levels would become the next downside targets if the breakout fails.
Nasdaq 100 key technical levels
- Current price: Around 30,245
- August swing high:30,195
- Close-risk support:29,946
- Key support zone:29,669 to 29,946
- Upside target zone:30,587 to 30,762
- 200-hour moving average:29,427
- 100-hour moving average:29,320
Why the breakout areas matter
When price breaks above an established resistance area, that same zone often becomes support. Traders who sold near resistance may look to exit if the market stays above it, while buyers who missed the initial move may use a pullback toward the breakout area as an opportunity to enter.
That does not mean support must hold. It means the former resistance zone provides traders with a clearly defined level for measuring whether buyers or sellers are winning the battle.
In both indices, the technical roadmap is straightforward:
- Stay above the breakout zones: Buyers remain in control, with the next major highs in focus.
- Fall back into the breakout zones: Some of the bullish momentum begins to fade.
- Break below the zones and stay below: The breakouts would be called into question, and traders would look toward the 100-hour and 200-hour moving averages.
Bottom line
Both Nasdaq indices have made meaningful technical breaks to the upside.
The Nasdaq Composite is targeting its all-time high at 27,190.21, while the Nasdaq 100 is looking toward the June high zone between 30,587 and 30,762.
The buyers have control, but holding above former resistance is now the key. For the Nasdaq Composite, that means staying above 26,676 to 26,856. For the Nasdaq 100, it means remaining above 29,669 to 29,946.
Stay above, and the buyers can continue to attack the highs. Move back below, and today’s bullish breakouts would start to lose some of their shine.
This article was written by Greg Michalowski at investinglive.com.