NASDAQ futures are coming into the week up at quick +85 after an overnight session featuring extreme range and volume. Price gapped lower Sunday night, probing down into last Tuesday’s range for about 15 minutes. The rest of the Globex session was dominated by buyers who steadily campaigned price back up into last Friday’s range and eventually back up to Friday’s midpoint. As we approach cash open, price is sticking to the 10,000 level.
On the economic calendar today we have existing home sales at 10am followed by 3- and 6-month T-bill auctions at 11:30am.
Last week kicked off with a gap down then a trend day up, with conviction buying all session. The strength continued into Tuesday then we sort of marked time for the rest of the week, slightly drifting higher. Some sell flow showed up Friday. The last week performance of each major index is shown below:
On Friday the NASDAQ printed a double distribution trend down. The day began with a gap up into the 06/10 range (swing high day). After a brief open two-way auction sellers drove price lower, closing the overnight gap and nearly taking out the Thursday low before a responsive bid returned price to the daily midpoint. Sellers defended the mid sending us down through Thursday low by a few ticks before another strong responsive bid shot price back up to the midpoint. Sellers defended the mid a second time around and ended the day down on the lows.
Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 9919.50. Look for buyers just below at 9911.75 and two way trade to ensue.
Hypo 2 stronger sellers tag 9874.75 before two way trade ensues.
Hypo 3 buyers gap-and-go higher, trading up through overnight high 10029. Look for sellers up at 10071.25 and two way trade to ensue.
Volume profiles, gaps and measured moves: