NASDAQ futures are coming into midweek gap down after an overnight session featuring elevated range on normal volume. Price poked above the Tuesday high, briefly, before finding a sharp responsive seller. We are pressing below the midpoint of Tuesday’s range as we approach cash open.
On the economic calendar today we have Industrial/Manufacturing production data at 9:15am, NAHB Housing Market index at 10, crude oil inventory at 10:30am, and Long-term TIC flows at 4pm.
Yesterday we printed a normal variation up. Buyers drove the market higher after it opened gap up. An afternoon rotation back into the morning drive revealed initiative buyers who managed to press a range extension up toward the end of the day.
Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4766.25. Look for sellers near the gap fill who work the market down through overnight low 4743.50. Buyers defend ahead of 4710 and two way trade ensues.
Hypo 2 sellers drive lower off the open, probe below Tuesday low 4726 setting up a move to target the open gap at 4695.25 before two way trade ensues.
Hypo 3 strong buyers take out overnight high 4783 and trigger a short squeeze up to 4820 before two way trade ensues.
Levels:
Volume profiles, gaps, and measured moves:
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