Nasdaq futures are priced to gap up slightly heading into Tuesday. The overnight session was a balanced-two way chop along yesterday’s midpoint. The range printed is normal on abnormally low volume.
At 8:30am Durable Goods data came in weaker than expected, and at 9am House Price Index did too. The initial reaction to both news items is selling. Also on the docket, we have a morning loaded with low impact events including Markit Manufacturing PMI at 9:45am, New Home Sales at 10am, and Richmond Fed at 10am as well.
Yesterday we started the week with a big gap up after news out of the Euro zone sent world equity markets higher. The Nasdaq managed to close the open gap it left behind from May 28th during the opening trade. Buyers briefly became initiative, pushing us range extension up, before responsive sellers stepped in and pushed us neutral.
Heading into today, my primary expectation is for a choppy open. The flurry of news items and balanced overnight session suggest we chop between 4545.75 – 4531.75 before heading higher to test above yesterday’s HOD 4552.25 to target a measured move up to 4557, then 4565.75.
Hypo 2 sellers break the balance to target the MCHVN at 4512.75. Look for responsive buyers at 4509.75 otherwise the open gap down at 4499 becomes a likely magnet.