The Nasdaq-100 (NDX) made an abrupt about-face with yesterday’s +3% rally ahead of some major tech company earnings like Apple (AAPL) and Amazon (AMZN) slated for today’s postmarket session. The move up also seems to have been aided in part by dovish comments about possible rate cuts in September from Federal Reserve chairman Jerome Powell during yesterday’s conference and has counteracted some of the recent losses after the tech-heavy index hit all-time highs of 20,690.97 on Jul. 10. Still, the NDX is down about -6.4% since those all-time highs as of yesterday’s close even as early trading in the Nasdaq futures contract points toward the rally continuing today.

Yesterday’s surge helped the technical picture, as price recaptured the 63-day Exponential Moving Average. However, the 50-day Simple Moving Average and the 21-day EMA still represent notable areas of upside resistance for price, coming in at about 19,463 and 19,518 respectively. The move also broke a downward sloping trendline that began near the all-time highs and connected subsequent highs on Jul. 23 and Jul. 30. Furthermore, price still remains in a long-term upward channel that began with the 52-week lows on Oct. 26, and held the line on Jul. 30.

Momentum is also improving somewhat. The Relative Strength Index (RSI) broke through a downward sloping trendline that matched up with the previously mentioned shorter-term price trendline. Looking backward as well, the RSI gave some directional clues, first when it showed bearish divergence when price was making new all-time highs, and more recently when it showed bullish divergence at the recent lows.

Watch to see if price can break through the previous double-bottom lows of 19,475, as old support can become new resistance, which is also quite close the 21-day EMA. Additionally, if price continues to move to the upside, the next notable area is where a downside gap begins near 19,736. To the downside, price saw a small upside gap near 18,700 and price has held that supportive area twice in recent trading. The next potential area of interest is the relative lows near 18,190.

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