Tuesday, February 9, 2016
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NASDAQ Futures Green After Big Overnight Session

CASHIN

NASDAQ futures are coming into Wednesday positive after a Globex session featuring extreme range and volume.  Price worked down below the Tuesday low before reversing around midnight.  Since then price traded up to the session mid from yesterday.  At 7am MBA Mortgage Applications came in way below expectations and at 8:15am the ADP Employment Change was better than expected.

Also on the economic calendar today we have ISM Non-Manufacturing at 10am and crude oil inventories at 10:30am.

Yesterday we printed a double distribution trend day down.  This day-type carries the second most directional conviction.  Therefore, opening gap up is likely to surprise a few participants.

Heading into today my primary expectation is for sellers to work into the overnight inventory to close the gap down to 4191.25.  From there look for a move to test4173.50 before responsive buyers step in and two way trade ensues.

Hypo 2 buyers work up from the gap and trade up to 4224.25.  Look for responsive sellers here and two way trade to ensue north of 4173.75.

Hypo 3 sellers accelerate down through the gap fill at 4191.25 and sustain trade below 4173.75 setting up a test below overnight low 4175.25.  Look for responsive buyers around 4147.

Hypo 4 strong buying drives up through 4224.25 and moves to target 4247 before two way trade ensues.

Levels:

02032016_NQ_MP

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Down in The Slip Zone

slipstream

NASDAQ is pushing down into the single prints from last Friday.  In theory, not much information has changed since Friday morning, but what has?

Don Trump took the #2 slot in the IOWA caucus without using nearly as many resources as the other candidates.  Trump wants to kill Wall Street.

Alphabet became the biggest company in the world.  Therefore the internet surpassed the gadgetry that takes you to the internet.  Some call it a paradigm shift.  I call google The Leader.

That’s about it.  Everything else is the same, so buyers ought to act the same down here, yes?  Behaving with the same tenacity and vigor they sported Friday morning?

Perhaps, but these single prints, once reclaimed, tend to be thoroughly examined once we spend time inside them.

Therefore, if buyers do not show up ASAP, we are likely to close on the lows, bros.

Over the weekend Rose Colored Sunglasses triggered, a working short bias generated by my index model inside Exodus.  The week is young, but the model nudged toward taking home the victory this week.  It took the ‘IOWA caucus’ victory already in the Russell (a risk-off divergence) but I will not consider it a proper victory until (and only if) the NASDAQ tags 4147.

Here is the slip zone I am going on about:

02022016_NQ_MP_SLIP

Stay sharp.  February is starting to act a lot like January.

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Sellers Cut into The First Night of February Trade

MADMAX

NASDAQ futures are lower heading into Tuesday after an overnight session featuring extreme range on elevated volume.  Price spent most of the session working lower but sellers were contained ahead of the Monday low.

On the economic calendar today we have a 4- and 52-week T-Bill auction at 11:30am.

Yesterday we came into the week gap down and after very briefly exceeding overnight low price worked higher to close the overnight gap.  From there we continued higher up through overnight high.  The afternoon also saw a rally.  Yesterday afternoon, just after closing bell price spiked higher on strong earnings from Alphabet. The rip was faded by sellers to form a distinct excess high on the session.

Heading into today my primary expectation is for buyers to work into the overnight inventory but struggle to fill the gap.  Instead sellers stall out around 4268.  From here we work lower to take out overnight low 4234.25 before two way trade ensues.

Hypo 2 buyers work up though 4268 and sustain trade above it.  Look for buyers to target 4277.  Buyers struggle to get up through 4282.50 but eventually do a full gap fill up to 4289.50.  From here buyers are likely to take out overnight high 4293.25.  Look for responsive sellers ahead of yesterday session high 4309.25 and two way trade ensues.

Hypo 3 sellers push off the open and take out overnight low 4234.25.  Unable to recapture 4242, the market continues lower to target 4215.50 before two way trade ensues.

Hypo 4 strong buyers drive higher off the open and close the overnight gap up to 4289.50.  They take out yesterday high print 4309.25 and we trend higher to target 4330.

Levels:

02022016_NQ_MP

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Day After Trend Day; First of The Month Logic

YELLEN-MACHINE-GUN

NASDAQ futures are heading into Monday gap down after an overnight session featuring normal range on slightly elevated volume.  Price briefly exceeded the Friday high before spending the rest of the session in a slow-grinding lower but sustaining above the Friday midpoint.

At 8:30am we had Personal Consumption Expenditure data which came out inline.  At 10am we have ISM Manufacturing, and at 11:30am there are 3- and 6-month T-Bill auctions.

Last Friday, despite weak guidance from Amazon, the market opened flat and a strong rally took place early on. The market balanced through the lunch hour then went into trend day up mode to close the week out strong.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4263.75.  From here buyers take out overnight high 4273.  Look for responsive sellers up at 4288.75 and two way trade ensues.

Hypo 2 buyers push up through 4288.75 and sustain trade above it to set up a trend up to 4329.75.

Hypo 3 sellers work down through overnight low 4230.75 but struggle to push below 4225.  Instead responsive buyers step in and work up to 4258 before two way trade ensues.

Hypo 4 sellers accelerate down through overnight low 4230.75 and make a liquidation move down to 4207.25 before two way trade ensues.

Levels:

02012016_NQ_MP

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Going Nowhere Fast into Month End

during the NASCAR Sprint Cup Series AAA 400 at Dover International Speedway on September 29, 2013 in Dover, Delaware.

NASDAQ futures are priced for a gap up after an overnight session featuring extreme range and volume. Price managed to mark overnight low early in the session after Amazon earnings spiked the market.  From there price went on to take out the high print from yesterday before settling into balance.  At 8:30am GDP data came out slightly weaker than expectations [0.70% vs 0.80% est] but end consumption beat nicely [2.2% vs 1.8% est].

Also on the economic calendar today, we have Chicago Purchasing Manager at 9:45am, U. of Michigan’s Final January read of Confidence at 10am, and the Baker Hughes rig count at 1pm.

Yesterday we printed a normal variation down.  The market opened gap up and sellers worked into the tape early.  Price managed to go range extension down briefly after 10:30am and found a sharp responsive buyer ahead of Wednesday’s low.  From there the market formed an excess low and initiative buyers [initiative relative to the excess low, responsive relative to the open] struggled and were unable to take out session high.  Price ultimately settled at the mid after Amazon earnings spiked price lower during settlement period.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4154.50.  Look for responsive buyers ahead of 4135 and two way trade to ensue.

Hypo 2 sellers close overnight gap down to 4135 then take out overnight low 4128.50.  Look for a move down to 4110 before responsive buyers step in.

Hypo 3 buyers work in early and push price up through overnight hgih 4198.50 to test the 4200 century mark.  Look for responsive sellers at the NVPOC at 4202.

Hypo 4 buyers sustain trade up around the 42020 NVPOC setting up a move to target the open gap up at 4226.75.

Levels:

01292016_NQ_MP

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Extremely Balanced Night Session

night_session_balance

NASDAQ futures are coming into Thursday gap up after an overnight session featuring extreme range and volume.  Price managed to trade within yesterday’s range in nearly symmetrical balanced trade.  At 8:30am Durable Goods data came out way below expectations.  At the same time, Initial/Continuing Jobless claims data was mixed.  The initial reaction is selling.

Also on the economic calendar today we have Pending Home Sales at 10am and a 7-Year Note auction at 1pm.

Yesterday we printed a neutral extreme down.  The data started with a gap down and sellers driving price lower.  Just moments after the first hour of trade completed, a strong responsive bid was found right at last Thursday’s naked volume point of control 4153.  Buyers pressed through the entire range and put the market Neutral ahead of the FOMC rate decision.

Third reaction yielded a mixed, but consensus sell signal and we pushed lower, taking out the lower ATR band before finding responsive buyers deep inside last Thursday’s range.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4128.50.  Look for responsive buyers to defend here, keeping us from testing yesterday’s low 4102.  Two way trade ensues with a price ceiling around 4180.

Hypo 2 sellers push the gap fill down to 4128.50 then continue lower to test below yesterday’s low 4102.  This triggers a liquidation.  Downside target is 4070.

Hypo 3 buyers gap-and-go.  Price works up though 4180 and sustains trade above it setting up a move to take out overnight high 4190.  Responsive sellers step in at 4211 and two way trade ensues.  Stretch targets are 4225 then 4247.50.

Hypo 4 sellers push into overnight inventory but cannot fill gap down to 4128.50.  Instead buyers defend 4140 and the market spends the rest of the session working higher to take out overnight high 4190.

Levels:

01282016_NQ_MP

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Fed Day: Best Day of The Month

Wardaddy (Brad Pitt) in Columbia Pictures' FURY.

NASDAQ futures are priced to come into Wednesday gap down after an overnight session featuring extreme range on elevated volume.  The session’s price action was balanced overall and price was contained within yesterday’s range while traversing most of it.  At 7am MBA Mortgage Applications came in slightly below expectations.  The initial reaction was buying.

The economic calendar is busy today.  The biggest event comes at 2pm when we hear the FOMC Rate Decision.  This is the highest impact event for the marketplace.  We also have New Home Sales at 10am, crude oil inventory at 10:30am, a 2-Year Floating Rate Note auction at 11:30am, and a 5-Year Note auction at 1pm.

Yesterday we printed a normal variation up.  The morning gap up was faded and filled.  A push back down into last Thursday range (01/21) was rejected by responsive sellers who spent the rest of the session working higher.  Price stalled out at the Monday VPOC around 4236 and closed just below the level.  After the bell, Apple earnings caused a bit of volatility.

Heading into today my primary expectation is for buyers to press into the overnight inventory but struggle to close the gap up at 4226.75.  Instead sellers stall out around 4222 and two way trade ensuses, taking out neither overnight high or low until we hear the afternoon FOMC rate decision.

Hypo 2 buyers push a full gap fill up to 4226.75 and sustain trade above it.  Initiative buyers come in ahead of the FOMC rate call and work price up through overnight high 4237.25.  Look for price to continue higher to target 4247.50 before finding responsive sellers and two-way trade ensues.

Hypo 3 sellers push off the open and work down to 4183.75 before tight, two-way trade takes hold ahead of the FOMC rate decision.

Hypo 4 sellers accelerate down through 4183.75 and sustain trade below it to set up a leg lower to take out overnight low 4177.50.  Look for responsive buyers just below the level and two way trade to ensue ahead of the Fed.

Watch for the third price reaction after the FOMC rate decision to provide market direction into the end of the week.

Levels:

01272016_NQ_MP

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NASDAQ Buyers Defend Fast Down Move

VIETMAM

NASDAQ futures are priced to gap up after an overnight session featuring elevated volume and extreme range.  Price managed to work down to the close from last Thursday before responsive buyers stepped in.  Buyers then pushed up through the entire range and as we approach cash open, the market is near Globex high.  At 9am a slew of housing data was released.  The initial reaction is flat.

On the economic calendar today we have Markit Service/Composite PMI at At 9:45am.  The biggest data on the session comes at 10am when we hear the latest Consumer Confidence read.

Yesterday we printed a neutral extreme down.  Price opened gap down and formed a tight range through most of the morning.  During the morning chop sellers managed to push the market range extension down.  Buyers quickly reversed the RE down and pushed to a new weekly high.  Price stalled out just below overnight high [after closing the 01/14 gap at 4258.75] and traversed the whole range a third time.  Sellers then accelerated down into last Thursday/Friday’s gap and we closed out near session low.

Heading into today my primary expectation is for buyers to squeeze off the open.  Look for a move up to 4227.50.  From here responsive sellers step in and work a gap fill down to 4186.50 before two way trade ensues.

Hypo 2 sellers work the gap fill down to 4186.50.  Responsive buyers step in around 4169.25 and a tight range, two way trade ensues.

Hypo 3 sellers close overnight gap down to 4186.50 early and accelerate down through 4169.25 to set up a move to take out overnight low 4133 and close the Thursday gap down at 4130.25.  Look for responsive buyers just below at 4128.50.

Hypo 4 strong buying pushes the pole climb up to 4227.50 early and trade is sustained up at these levels.  This sets up a secondary move to target 4247.75.  Stretch target is a test above the Monday high 4259.75.

Levels:

01262016_NQ_MP

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Globex Volatility Eases for First Time in 2016

SleepingBear

NASDAQ futures are priced to start the week out gap down after an overnight session featuring elevated [but not extreme] range and volume.  Price managed to briefly push above the high print from last Friday before settling into balanced trade.

The economic calendar is light today with only a 3- and 6-month T-Bill auction at 11:30am to be aware of.  Remember, Wednesday afternoon we have The Fed Rate Decision which is the highest impact event for the market currently.

We came into last week on a Tuesday.  Markets were closed Monday in observation of Dr. Martin Luther King day.  On Tuesday price opened gap up and we spent the day working lower.  Responsive buyers stepped in at the end of the session.  Tuesday opened pro gap down and drove lower all morning.  The action found a strong responsive bid by early afternoon and we spent the rest of the week auctioning higher.

Last Friday opened with a big gap up and price was set on a slow grind higher.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4247.  Then look for a test above last Friday’s high 4253 however sellers step in ahead of overnight high 4260 and work us back down through the range to take out overnight low 4218.  This sets up a move down to 4188.25 before two way trade ensues.

Hypo 2 buyers fill overnight gap up to 4247 then set their sights on overnight high 4260 which also lines up with the 4258.75 open gap from 01/14.  Look for buyers to sustain trade above this level setting up a move to target 4288.50 before two way trade ensues.

Hypo 3 buyers cannot fill overnight gap.  Sellers take out overnight low 4218.50 and work down to 4188.25.  The initial buyers in this region are overrun and we continue lower to target 4154.25 before two way trade ensues.

Levels:

01252016_NQ_MP

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Overnight Rip Keeps Investors on Their Toes

Four horses are very close, but Mr. Gnarly has pulled into the lead as the horses round the final bend in the first race.

NASDAQ futures are priced to open pro gap up after a Globex session featuring extreme range and volume.  After a balanced session through midnight, price trended up to make a new high on the week.  Responsive sellers stepped in right at the midpoint from last Thursday.

On the economic calendar today we have Markit Manufacturing PMI at 9:45am, Existing Home Sales and Leading Indicators at 10am, and the Baker Hughes Rig Count at 1pm.

Yesterday we printed a normal variation up.  Price opened gap up and we had a rejection reversal sell on the open.  Responsive buyers stepped in around the 4100 century mark and made a hard push higher which transitioned into a sideways, grinder market.

Heading into today my primary expectation is for sellers to work into the overnight inventory and trade down to 4187.  Look for responsive buyers here (responsive relative to the open, initiative relative to yesterday close) who reject an attempt back into Thursday’s range.  Then look for a move to take out overnight high 4213.  Responsive sellers show up at 4220.25 and two way trade ensues.

Hypo 2 buyers push up through 4220.25 and sustain trade above it, setting up a fast (pocket) move up to 4255.50 before two way trade ensues.

Hypo 3 sellers aggressively work into the overnight inventory, make short work of 4187 and test down to 4166.  Responsive buyers show up here but are overrun and we continue lower to fill the overnight gap down to 4130.25.  From here take out overnight low 4119.  Look for a strong responsive bid down at 4117.25.

Levels:

01222016_NQ_MP

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