NASDAQ futures are set to open with a modest gap down after an interesting overnight session. Range and volume were normal but the session kicked off with a gap down, something we haven’t seen in 2016. Price pushed down and tested the value area established earlier this month before a responsive bid came in and two way trade ensued.
The economic calendar is light all week. Today we have the NAHB Housing Market Index at 10am, also a 3- and 6-month T-bill auction at 11:30am.
While the economic calendar is light, earnings season kicks into high gear. After the bell today we will hear from IBM and Netflix.
Last week started out with sellers attempting lower. Their campaign continued into Tuesday morning before an extremely strong responsive bid stepped in–so strong it pushed higher for the whole session. This led into a gap up Wednesday and continued upward action though Thursday before responsive sellers were found.
Friday price worked lower before finding a bid and settling into two way trade.
Heading into today my primary expectation is for sellers to work into the overnight inventory. Normally, when we are coming into the session gap down I am looking for the opposite, buyers, but last night’s session opened gap down then worked higher, suggesting inventory is long. Look for sellers to work down to 4504.50 before responsive buyers step in and work higher, eventually taking out overnight high 4534.50 before two way trade ensues.
Hypo 2 sellers take out overnight low 4501 and target the open gap down at 4489.75 before two way trade ensues.
Hypo 3 buyers work higher off the open, take out overnight high 4534.50 and sustain trade above 4536.50 setting up a move to 4549.75 before two way trade ensues.
Levels:
Volume profiles, gaps, measured moves:
Weird open. market is just trading with crude and xle absurdity. I hope earnings take centerstage soon.
Is Buffet still long IBM?
I sense NFLX is going to go Gorilla to the upside. Time to leave this 130 level in the rear view. Ya heard me.