NASDAQ futures down about -40 heading into Monday after an overnight session featuring extreme range and volume. Price was balanced overnight, balancing along the lower quadrant of Friday’s range until about 4:30am when a hard sell pushed into the market. Said sellers stalled before taking out the Friday low. Since then we have flagged below the balance that occurred during the early part of the Globex session. As we approach cash open price is hovering in the lower quad of Friday’s range.
On the economic calendar today we have 3- and 6-month T-bill auctions at 11:30am.
Last week featured a gap up and rally all day Monday. There was some sustained rallying early Tuesday before a sharp sell hit the tape late Tuesday morning. Wednesday was sort of choppy early on, then there was a hard fade lower into the close. Thursday was choppy ahead of a strong trend lower Friday.
The last week performance of each major index is shown below:
On Friday the NASDAQ printed a trend down. The day began with a slight gap up. After an open two way auction buyers made a brief test up beyond Thursday high. Sellers stepped in and rejected a move up beyond Thursday high, setting up a quick gap fill and drive down through Thursday low. Sellers continued lower, effectively closing some gaps we left behind on 10/26 (nearly to the tick) and 10/27. There was a ramp off the lows into the bell.
Heading into today my primary expectations is for buyers to work into the overnight inventory and close the gap up to 15686.50. From here buyers continue higher, tagging 15,885 before two way trade ensues.
Hypo 2 sellers take out overnight low 15,592 and campaign down through Friday low 15,538. Look for buyers down at 15,500 and for two way trade to ensue.
Hypo 3 stronger sellers tag 15,394.50 before two way trade ensues.
Volume profiles, gaps and measured moves:
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