Bullish engulfing pattern may fail on the Nasdaq 100US 100 IndexTVC:NDQFPMarketsDespite yesterday’s textbook bullish engulfing pattern on the Nasdaq 100, price action on the daily chart is caught between two converging descending lines from 30,195 and 29,123. Many technical analysts refer to this as a bullish pennant pattern. Between the noted pennant pattern sits the 50-day SMA at 29,221, which is above the recently formed bullish engulfing formation. Given this, I feel enthusiasm may be lacking here, especially if the index struggles to get back above the SMA. If that is the case, price could continue to compress lower within the pennant’s formation until the unit retests support at 28,234 before buyers show up. Written by FP Markets Chief Market Analyst Aaron Hill