Nasdaq futures traded a wide but not extreme range overnight on elevated but normal volume. Price managed to exceed Friday’s low, briefly, before pushing back into range and balancing. Around 4am aggressive buying pushed in and worked price into the upper quad of Friday’s range before finding sellers and balancing out. We are headed into the open with price hovering around pro gap territory.
This week’s economic calendar is relatively light compared to last week. On the docket for today is Existing Home Sales at 10am.
Last week price worked higher all week into Thursday afternoon’s FOMC rate decision. When The Fed delayed the rate hike investors reacted by spiking price higher. By the end of the day the market rolled over and closed near session low. Friday opened gap down and churned sideways. The result was a flat-to-up market on the week. Friday printed a neutral day.
Heading into today my primary expectation is for sellers to work into the overnight inventory. Look for sellers to close the overnight gap down to 4326.75. Then expect price to overshoot the gap fill and test down to 4308.50 before buyers step up and two way trade ensues. Then look for sellers to target a test below overnight low 4297.75.
Hypo 2 sellers struggle to close overnight gap down to 4326.50. Instead buyers defend around 4338 and continue working higher. Look for a test above overnight high 4354.50 and a buyer target Thursday’s open gap up at 4366.25.
Hypo 3 gap and go up. Take out overnight high 4354.50 early and set up the gap fill up to 4366.25. After some churn price continues higher to target 4378.50.
Levels:
hypo 2 a bit off basis, sellers managed to close the gap to the tick then we started working higher, hypo 2 still in play