For the second consecutive day the NASDAQ is coming into the session gap up. The globex session featured a slightly elevated range on normal volume. Price spent several hours grinding sideways along the low print set yesterday before a strong buying pushed entered early this morning. At 7am, MBA mortgage applications came in stronger than expected. Housing Starts at 8:30am was weaker than expected but Building Permits better.
Also on the economic calendar today is the Crude Oil inventory at 10:30am. Then we have the high impact FOMC minutes at 2pm this afternoon.
Yesterday we printed a neutral day. Price started the day out strong but sellers defended the low from last Thursday. As soon as we entered the Thursday range price formed an excess high. After some big chop, sellers prevailed and pressed through session low to print a neutral day.
Heading into today my primary expectation is for sellers to push into the overnight inventory and close the gap down to 4570.25. Look for buyers to step in and two way grind to ensue until we hear the FOMC minutes.
Hypo 2 buyers use the gap up to go higher. Price holds north of 4580 and buyers take out overnight high 4589.75 setting up a move to target 4616 before two way trade ensues.
Hypo 3 sellers close gap down to 4570.25 then take out overnight low 4556.25. The profile is thin down here. Look for sellers to accelerate down through the low and trigger a liquidation down to 4514.25 before two way trade ensues.