NASDAQ futures are coming into Wednesday 100 points higher after an overnight session featuring extreme range and volume. Price worked higher overnight, erasing all of the downward progress sellers made intraday Tuesday, selling progress that came after we opened nearly 100 points higher yesterday. As we approach cash open price has probed beyond the Tuesday high and is hovering beyond it. At 8:30am consumer price index data came out in-line to slightly-better than expected.
Also on the economic calendar today we have crude oil inventories at 10:30am, a 10-year note auction at 1pm, and a monthly budget statement at 2pm.
Yesterday we printed a normal variation down. The day began with a gap up to near the high from last Friday’s trend down. After a fierce battle between buyers and sellers at the open, sellers stepped in and began working price lower. The steadily worked lower, eventually closing the 100 point gap and briefly probing below overnight low before two way trade ensued. The day ended more-or-less flat after and afternoon responsive bid took price back to the daily midpoint.
Heading into today my primary expectation is for sellers to work into the overnight inventory and trade down to 6768.50. Initiative buyers step in here (initiative relative to Tuesday’s close, responsive relative to today’s open) and we work up through overnight high 6824.25 setting up a move to target 6882.25 before two way trade ensues.
Hypo 2 stronger buyers gap-and-go higher, trading up to 6900 and sustaining trade above the century mark, setting up a move to target the composite VPOC at 6950.
Hypo 3 sellers work a full gap fill down to 6715.75 setting up a move down through overnight low 6671.75. Look for buyers down at 6700 otherwise stretch side target to downside is 6600.
Volume profiles, gaps, and measured moves:
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