NASDAQ futures are coming into Wednesday gap down after an overnight session featuring extreme range and volume. Price was balanced most of the overnight session until about 5:45am when sellers pushed into price. Said selling was unable to take out the Tuesday low before discovering a responsive buyer. As we approach cash open, price is hovering in the lower quadrant of Tuesday’s range.
On the economic calendar today we have crude oil inventories at 10:30am followed by a 10-yeat note auction at 1pm.
Yesterday we printed a double distribution trend down. The day began with a gap down below the Monday midpoint. After a brief two-way open auction, price drove lower, taking out the Monday low early on before beginning to trend lower. We trended down to 7600 before a ramp higher set up into closing bell.
Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 7674. From here we continue higher, up through overnight high 7698 before stalling into two way trade.
Hypo 2 buyers sustain trade above 7700 setting up a move to target 7731 before two way trade ensues.
Hypo 3 sellers press down through overnight low 7602 setting up a move to target 7557 before two way trade ensues.
Volume profiles, gaps, and measured moves:
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