Well, we rallied yesterday past the previous days intra-day high of 6015.50 and past the previous highs in the 6026 region. My own DailyTargets indicator had pegged a upper target at 6041.50. During the out-of-gate run up, the NQ fell just shy of this target (6040.50) and as expected, encountered some profit taking after the open to the 6018 region. Once these retail traders left the active positions, the December E-mini Nasdaq-100 Index futures rallied to a new contract high by close. Technical read does not show significant resistance for the NQ above its current crest level above 6060.

The trend now shifts to being up according to the daily chart. Back in the last week of September when we touched 5842, we have done nothing but grind up and yesterday was the best known rally in a single day. I expect some cycling before continuing higher also affected by the Unemployment news that is due today.

Weakness in the price pattern will not be noticeable unless we breach the previous highs in the 6026 area. If we fall through here with good volume it would mean we see some profit taking quickly and the prices will likely fall to the low 6000. I do not believe that the spike yesterday was caused by stops from a short squeeze. In my opinion, strictly, the move up was fueled by the move in the broader index were several options traders were estimating the top for the ES to be around 2540. As the ES took out that level with reasonable comfort, what we witnessed is a rally in the other indices which of course includes the Tech heavy NQ.

A trade and close below yesterdays Globex low at 6001.00 will turn the index down for the session creating a bearish closing price reversal top. If in fact, we fall through this level today (which appears unlikely), I would expect aggressive buying in the 5967 area from value seekers.

(Click on image to enlarge)