Nasdaq futures are a touch higher as we head into Wednesday’s trade. The action overnight was balanced with a slight upward bias. Price managed to go above yesterday’s high and into the lower quadrant of last Friday’s range before sellers showed up. Range and volume were normal on the session.
The big economic event today is the 2pm FOMC rate decision. No one expects them to raise the benchmark short-term interest rate for the first time since 2006. We had MBA Mortgage Apps data at 7am and selling has come into the tape since. We also have Pending Home Sales at 10am and oil/gas inventories at 10:30am.
Yesterday we printed a double distribution trend day after starting the session under selling pressure. Price briefly took out Monday’s low before finding a strong responsive bid. The interesting trait left behind is a low VPOC—down at 4510. It means value might be lower than where price is currently trading.
Heading into today, my primary expectation is sellers push into the overnight inventory to close the gap down to 4556.75 and continue to target the overnight low 4548.50. Look for responsive buyers at 4544 then again at 4534. Then two-way trade as we wait for the afternoon FOMC minutes.
Hypo 2 buyers push up and sustain trade above Friday’s close 4563.75 setting up a run to target the overnight high 4572.75. The profile overhead is thin meaning we could see price rally well if this occurs. Look for sellers around the 4600 mark.
Hypo 3 tight trading between 4570 and 4550 until we see the FOMC minutes.
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