The Only Way Out Is Up

220 views

The overnight session was fairly quiet up until CPI data at 8:30am which pushed some sellers onto the tape. Overall the session is normal in range and volume and trading in the upper quad of yesterday’s session.

On deck this afternoon we have Fed Chair Yellen speaking at 1pm. We have the Baker Hughes Rig Count data out at the same time.

Yesterday we printed a short squeeze-type profile, P-shaped. Sustained trade below overnight low 4523 is what sellers want to see to take back the session.

Heading into today, my primary expectation is for buyers to work higher to test overnight high 4535.50 and take it out to target the NVPOC at 4543.50.

Hypo 2 sellers sustain below 4523 setting up a washout lower to 4500.

Levels:

05222015_NQ_MarketProfile

Settling Into Balance

347 views

Nasdaq futures are trading a touch lower as we head into cash open. The overnight session was normal in terms of range but volume is borderline abnormal. On the economic calendar we have a flurry of low/medium impact events to push through this morning. At 8:30am Chicago Fed National Activity Index and Initial/Continuing Jobless Claims data was out and saw little reaction from the market.

Late on this morning we have Markit Manufacturing PMI at 9:45am, a data dump including Existing Home Sales, Leading Indicators, and Philadelphia Fed at 10am, and Natural Gas storage stats at 10:30am.

Yesterday we printed a curious-looking normal variation day. Price managed to push up to new weekly high before sellers knocked it back flat into the close. The last four sessions have compressed price into a range—the first real contraction in volatility we’ve seen in several weeks.

The action has made the market profile chart a bit odd, so I drew a micro composite volume profile of the last 4 sessions to see better what’s going on here (green and red distribution pictured below).

Heading into today, my primary expectation is for a choppy 2-way open until we push through all the morning data. Look for price to stay contained between 4481.25 to 4504. Then look for buyers to come in and work price higher.

Hypo 2 sellers push down through 4479.25 to open up a liquidation down to 4458.75.

Hypo 3 buyers make a run for yesterday’s session high 4534 to target 4539.

Levels:05212015_NQ_MarketProfile

Bring Forth The Siesta

207 views

Nasdaq futures are set to open a touch higher for Wednesday after trading a balanced session overnight on low-end normal range and volume. The GDP data out overnight from Japan turned out to be not much of an event and the US dollar strength held overnight.

Today we had MBA Mortgage Apps at 7am. Coming up we have the weekly Crude/Distillate report at 10:30am and the collective attention of traders will at some point be focused on the Fed Minutes due out at 2pm.

Yesterday we printed a normal variation down day. Buyers defended Monday’s mid around the close when a late wave of selling came through.

Heading into today, I expect any early excitement to quickly fizzle and the markets to go into chop mode ahead of the afternoon minutes. Look for buyers to make a push up through overnight high 4510.50. Look for responsive sellers to defend near 4515 and two way chop to ensue with 4498 as a floor.

Hypo 2 sellers push off the open, close the overnight gap to 4501 and continue lower to take out overnight low 4496.75 and push below yesterday’s low. Look for buyers at 4491.50 and two-way trade.

Hypo 3 strong buying up through 4515 to target 4531.25.

Levels:

05202015_NQ_MarketProfile

Early Morning Squeeze

203 views

Nasdaq futures are up a touch as we head into Tuesday. Range and volume are normal and per the structure of the market profile we can classify the current action. It is a temporary phenomenon known as a short squeeze where price moves higher as shorts are forced to liquidate their positions. Once they are done doing so, the profile takes on a P-shape.

In the context of a downtrend this structure tends to occur at-or-near inflection points. In our current context, choppy range, it may also mean something. However, the higher time frame is up so it ‘s difficult to assign it too much weight initially.

At 8:30am we had upbeats stats on housing stats which slowly introduced sellers into the index. It will be interesting to see if sellers keep us south of 4521.50 heading into cash open.

Yesterday we formed a double distribution trend day and pushed higher to close the 4/28 gap up at 4515.50 before stalling out. Value managed to shift up near session high just before the day wrapped up. This suggests value, not just price, were on the move higher.

As I wrap up my post the short squeeze profile is deteriorating as sellers work into the tape.

Heading into today, my primary hypothesis is sellers push into the overnight inventory to close the overnight gap down to 4507.25. From here to 4504.50 I will look for signs of responsive buying. If buyers no show, then I will look for a continued move down to 4491.50.

Hypo 2 is buyers push off the open and reclaim 4521.50 early and sustain trade above it setting up another leg up to target 4531.25 then 4535.25. Look for responsive sellers up near 4539.

Hypo 3 buyers push, stall around 4521 and we reverse lower to fill overnight gap 4507.25 and then two way chop ensues.

Levels:

05192015_NQ_MarketProfile

A Change in Pace

224 views

Nasdaq futures are price to open gap down to start the week. The last two Monday’s have stated gap up and pushed strength early only to reverse. Thus this week represents a fresh look to the markets. Volume and range are both normal on the globex session and overall market profile structure is ugly.

On the economic calendar we have NAHB Housing Market Index at 10am and an otherwise open schedule.

Friday we consolidated inside the upper quadrant of Thursday’s trend day. The session started strong, exceeding Thursday’s high and affirming the risk free nature of the trend day. However the session was a slow grind lower with no clear emerge of bulls.

Heading into today, my primary expectation is for buyers to work into the overnight inventory. Look for a push up to 4489.25 to close the overnight gap. If they can continue to exceed overnight high 4493.75 then look for a run to the 4500 century figure.

Hypo 2 is sellers push off the open and test below overnight low 4470.50. Look for buyers to defend 4458.50 and two way trade to ensue which might close the overnight gap up to 4489 but will stall ahead of 4493.75.

Hypo 3 is a push down through 4458.50 to target the composite HVN at 44550.

Hypo 4 we aggressive press higher, take out Friday’s high 4506.75 and target the gap up at 4515.50.

Levels:05182015_NQ_MarketProfile

Day After A Trend Day

326 views

Nasdaq futures spent the overnight session slowly drifting higher and did so on normal range and volume. One structural element currently stands out on the session, a weak high, seen clearly on the market profile as a double TPO print and an overall lopsided bell structure.

Today is the most action packed day of the week from an economic announcement standpoint. At 9:15am Industrial Production data is out followed by The May Preliminary reading of the U of Michigan Confidence number. The preliminary reading has recently been a successful number in generating a reaction from the market. Energy traders will be watching the Baker Hughes Rig Count at 1pm and at the close we have Net Long-Term Tic Flows.

Yesterday price opened pro gap up, above the prior day’s range and had an open auction that we briefly tested below before the market went one time frame up. The result was a trend day print. Market profile theory states any entry in the direction of a trend is a risk free entry into the following session. Therefore, expectation is for price to exceed the trend day high by at least a tick.

Heading into today, my primary expectation is for sellers to push into the overnight inventory. I expect some choppiness before 10am’s data. Look for buyers to defend north of 4493 and then work to take out the weak overnight high at 4507.50 to target 4517.25 before two-way trade ensues.

Hypo 2 we push down into the upper quad of yesterday’s trend day, taking out overnight low 4488 and looking for responsive buyers ahead of 4480 and two way trade ensues.

Hypo 3, gap and go higher, take out 4517.25 early and sustain trade above 4520, setting up a secondary leg up to 4538.75.

Levels:

NQ_MarketProfile_05152015

Fair Markets

248 views

Nasdaq is set to open pro gap as we head into Thursday. The overnight session features 44 point of range so far, nearly 2nd sigma which is 46.75 points. That tells us the session was quite abnormal, and on the borderline of being different than 95% of all overnight sessions over the last three years.

Volume behind the move is light, in typically upward fashion, currently within the threshold of normal.

We heard the initial/continuing jobless claims at 8:30am and so relatively little reaction to the data point. The only other economic event scheduled for today is the EIA Natural Gas Storage data at 10:30am.

The Nasdaq is auctioning in a methodical manner. Tuesday’s big gap lower was faded. We found responsive buyers Tuesday and spent the rest of the session trading higher. Yesterday we opened gap up and spent the entire session slowly working the gap fill lower. Today’s gap up is on the professional variety but still at risk of being filled. Conversely, there I an open gap up at 4476.25 which may entice the market upward. Overall the market has been an objective mechanism of price discovery all week.

Heading into today, my primary expectation is for sellers to push into the overnight inventory. There’s a big HVN at 4450 that might behave like a magnet once markets open. I will look for buyers to defend north of 4440 to set up a move to fill the gap up to 4476.25.

Hypo 2 is gap and go higher, push up to 4476.25 and find sellers who defend the 05/04 range.

Hypo 3 sellers push down though 4440 and sustain, setting up a fill of the overnight gap to 4424.25.

Hypo 4 bulls sustain trade above 4476.25 to target the NVPOC at 4489. Stretch target is 4493.

Levels:

NQ_MarketProfile_05142015

Gap Hunter

333 views

Nasdaq futures are up a touch as we head into cash open. The index spent most of the evening trading up following yesterday’s strong reactive buying. Range overnight managed to press 2nd sigma while volume stayed compressed into its normal range.

On the economic calendar we saw Advance Retail Sales at 8:30am which solicited a choppy but ultimately sideway reaction. We also have Business Inventories at 10am and Crude/Distillate Inventories at 10:30am.

Going back to the charts, yesterday we opened pro gap down and drove lower from the opening bell. The range was enough to expand volatility for a third week. It also managed to fill last Thursday’s pre NFP gap. The auction ultimately stalled out and found responsive buyers. We then worked higher to close the overnight gap up to 4431. A few attempts were made to reenter Monday’s range but ultimately we traded lower into the bell as the market was tasked with absorbing a heavy amount of supply in the final hour and a half of trade.

Heading into today, we are priced to open on the high-end of yesterday’s range. My primary expectation is for seller to push into the overnight inventory and trade down to 4420.50 to close the overnight gap. This market has demonstrated a strong proclivity to close gaps lately so it might as well continue doing so. From there sellers may continue pushing to 4416 where I will look for signs of buyers and then two way trade ensues.

Hypo 2 buyers push off the open to take out overnight high 4447.75 to target 4455.50 where sellers come in and two way trade ensues.

Hypo 3 buyers take out 4455.50-4457.75 and continue higher to target the open gap up at 4476.25.

Hypo 4 breakdown below 4416.25-4412 opening us up to trade down to 4395.50.

Levels:

NQ_MarketProfile_05132015

Down The Slip Stream

292 views

Nasdaq futures are pro gap down this morning. The action took us to second sigma range and volume, and effectively erased the entire pop from Nonfarm payroll only two sessions back.

The profile was thin, single prints, and created the scene for a fast move. The fact it was traversed overnight may be a positive. This occurred while none of the underlying components were trading. Therefore, it will be the responsibility of the market to balance itself back in line with its components come open.

Perhaps contributing to the selling was Fed’s Williams who, for whatever reason, went on CNBC yesterday evening and said “Every FOMC meeting is on the table for a rate hike.”

Heading into today, the only economic event of note is the Monthly Budget Statement at 2pm.

Yesterday we printed a normal variation down day and closed on session low after briefly taking out Friday’s high in the morning. Heading into today my primary expectation is for buyers to push into this overnight inventory and trade up to 4408. From there I expect supply to come in and us to continue trading lower to work toward 4367.50.

Hypo 2 buyers blow up through 4408 and push us back up to 4433.

Hypo 3 sellers gap-and-go lower, take out 4367.50 early and target 4357.50. Levels:

NQ_MarketProfile_05122015

In The Groove

243 views

Nasdaq futures are trading quietly ahead of this week’s start. After two Monday’s of starting out with a big gap up and volume elevated, today is set to open near-flat on volume low-end normal.

The economic calendar is quiet today. At 10am we’ll hear the latest read of the Labor Market Conditions Index. This is a low/medium impact number. Earning’s season is moving onto b-role companies and less likely to impact the overall market. The dominating headline risk remains with the eurozone and their Greek situation.

Friday price went pro gap up after Nonfarm payroll data received a positive reaction. We spent the rest of the session trading sideways with a slight upward bias. Since then, during globex, price managed to test below Friday’s low briefly before rotating 10 points higher.

Heading into today, my primary expectation is for 2-way auction to give way to more price discovery up. Buyers look to target a 05/04 gap fill up to 4476.25.

Hypo 2 is sellers take out overnight low setting up a test of the single prints down at 4437. If they can push down into them, look for a give-back of the NFP boost all the way down to 4403.25.

Hypo 3 is bracket trade between 4456 and 4445.

Levels:

NQ_MarketProfile_05112015

The Only Way Out Is Up

220 views

The overnight session was fairly quiet up until CPI data at 8:30am which pushed some sellers onto the tape. Overall the session is normal in range and volume and trading in the upper quad of yesterday’s session.

On deck this afternoon we have Fed Chair Yellen speaking at 1pm. We have the Baker Hughes Rig Count data out at the same time.

Yesterday we printed a short squeeze-type profile, P-shaped. Sustained trade below overnight low 4523 is what sellers want to see to take back the session.

Heading into today, my primary expectation is for buyers to work higher to test overnight high 4535.50 and take it out to target the NVPOC at 4543.50.

Hypo 2 sellers sustain below 4523 setting up a washout lower to 4500.

Levels:

05222015_NQ_MarketProfile

Settling Into Balance

347 views

Nasdaq futures are trading a touch lower as we head into cash open. The overnight session was normal in terms of range but volume is borderline abnormal. On the economic calendar we have a flurry of low/medium impact events to push through this morning. At 8:30am Chicago Fed National Activity Index and Initial/Continuing Jobless Claims data was out and saw little reaction from the market.

Late on this morning we have Markit Manufacturing PMI at 9:45am, a data dump including Existing Home Sales, Leading Indicators, and Philadelphia Fed at 10am, and Natural Gas storage stats at 10:30am.

Yesterday we printed a curious-looking normal variation day. Price managed to push up to new weekly high before sellers knocked it back flat into the close. The last four sessions have compressed price into a range—the first real contraction in volatility we’ve seen in several weeks.

The action has made the market profile chart a bit odd, so I drew a micro composite volume profile of the last 4 sessions to see better what’s going on here (green and red distribution pictured below).

Heading into today, my primary expectation is for a choppy 2-way open until we push through all the morning data. Look for price to stay contained between 4481.25 to 4504. Then look for buyers to come in and work price higher.

Hypo 2 sellers push down through 4479.25 to open up a liquidation down to 4458.75.

Hypo 3 buyers make a run for yesterday’s session high 4534 to target 4539.

Levels:05212015_NQ_MarketProfile

Bring Forth The Siesta

207 views

Nasdaq futures are set to open a touch higher for Wednesday after trading a balanced session overnight on low-end normal range and volume. The GDP data out overnight from Japan turned out to be not much of an event and the US dollar strength held overnight.

Today we had MBA Mortgage Apps at 7am. Coming up we have the weekly Crude/Distillate report at 10:30am and the collective attention of traders will at some point be focused on the Fed Minutes due out at 2pm.

Yesterday we printed a normal variation down day. Buyers defended Monday’s mid around the close when a late wave of selling came through.

Heading into today, I expect any early excitement to quickly fizzle and the markets to go into chop mode ahead of the afternoon minutes. Look for buyers to make a push up through overnight high 4510.50. Look for responsive sellers to defend near 4515 and two way chop to ensue with 4498 as a floor.

Hypo 2 sellers push off the open, close the overnight gap to 4501 and continue lower to take out overnight low 4496.75 and push below yesterday’s low. Look for buyers at 4491.50 and two-way trade.

Hypo 3 strong buying up through 4515 to target 4531.25.

Levels:

05202015_NQ_MarketProfile

Early Morning Squeeze

203 views

Nasdaq futures are up a touch as we head into Tuesday. Range and volume are normal and per the structure of the market profile we can classify the current action. It is a temporary phenomenon known as a short squeeze where price moves higher as shorts are forced to liquidate their positions. Once they are done doing so, the profile takes on a P-shape.

In the context of a downtrend this structure tends to occur at-or-near inflection points. In our current context, choppy range, it may also mean something. However, the higher time frame is up so it ‘s difficult to assign it too much weight initially.

At 8:30am we had upbeats stats on housing stats which slowly introduced sellers into the index. It will be interesting to see if sellers keep us south of 4521.50 heading into cash open.

Yesterday we formed a double distribution trend day and pushed higher to close the 4/28 gap up at 4515.50 before stalling out. Value managed to shift up near session high just before the day wrapped up. This suggests value, not just price, were on the move higher.

As I wrap up my post the short squeeze profile is deteriorating as sellers work into the tape.

Heading into today, my primary hypothesis is sellers push into the overnight inventory to close the overnight gap down to 4507.25. From here to 4504.50 I will look for signs of responsive buying. If buyers no show, then I will look for a continued move down to 4491.50.

Hypo 2 is buyers push off the open and reclaim 4521.50 early and sustain trade above it setting up another leg up to target 4531.25 then 4535.25. Look for responsive sellers up near 4539.

Hypo 3 buyers push, stall around 4521 and we reverse lower to fill overnight gap 4507.25 and then two way chop ensues.

Levels:

05192015_NQ_MarketProfile

A Change in Pace

224 views

Nasdaq futures are price to open gap down to start the week. The last two Monday’s have stated gap up and pushed strength early only to reverse. Thus this week represents a fresh look to the markets. Volume and range are both normal on the globex session and overall market profile structure is ugly.

On the economic calendar we have NAHB Housing Market Index at 10am and an otherwise open schedule.

Friday we consolidated inside the upper quadrant of Thursday’s trend day. The session started strong, exceeding Thursday’s high and affirming the risk free nature of the trend day. However the session was a slow grind lower with no clear emerge of bulls.

Heading into today, my primary expectation is for buyers to work into the overnight inventory. Look for a push up to 4489.25 to close the overnight gap. If they can continue to exceed overnight high 4493.75 then look for a run to the 4500 century figure.

Hypo 2 is sellers push off the open and test below overnight low 4470.50. Look for buyers to defend 4458.50 and two way trade to ensue which might close the overnight gap up to 4489 but will stall ahead of 4493.75.

Hypo 3 is a push down through 4458.50 to target the composite HVN at 44550.

Hypo 4 we aggressive press higher, take out Friday’s high 4506.75 and target the gap up at 4515.50.

Levels:05182015_NQ_MarketProfile

Day After A Trend Day

326 views

Nasdaq futures spent the overnight session slowly drifting higher and did so on normal range and volume. One structural element currently stands out on the session, a weak high, seen clearly on the market profile as a double TPO print and an overall lopsided bell structure.

Today is the most action packed day of the week from an economic announcement standpoint. At 9:15am Industrial Production data is out followed by The May Preliminary reading of the U of Michigan Confidence number. The preliminary reading has recently been a successful number in generating a reaction from the market. Energy traders will be watching the Baker Hughes Rig Count at 1pm and at the close we have Net Long-Term Tic Flows.

Yesterday price opened pro gap up, above the prior day’s range and had an open auction that we briefly tested below before the market went one time frame up. The result was a trend day print. Market profile theory states any entry in the direction of a trend is a risk free entry into the following session. Therefore, expectation is for price to exceed the trend day high by at least a tick.

Heading into today, my primary expectation is for sellers to push into the overnight inventory. I expect some choppiness before 10am’s data. Look for buyers to defend north of 4493 and then work to take out the weak overnight high at 4507.50 to target 4517.25 before two-way trade ensues.

Hypo 2 we push down into the upper quad of yesterday’s trend day, taking out overnight low 4488 and looking for responsive buyers ahead of 4480 and two way trade ensues.

Hypo 3, gap and go higher, take out 4517.25 early and sustain trade above 4520, setting up a secondary leg up to 4538.75.

Levels:

NQ_MarketProfile_05152015

Fair Markets

248 views

Nasdaq is set to open pro gap as we head into Thursday. The overnight session features 44 point of range so far, nearly 2nd sigma which is 46.75 points. That tells us the session was quite abnormal, and on the borderline of being different than 95% of all overnight sessions over the last three years.

Volume behind the move is light, in typically upward fashion, currently within the threshold of normal.

We heard the initial/continuing jobless claims at 8:30am and so relatively little reaction to the data point. The only other economic event scheduled for today is the EIA Natural Gas Storage data at 10:30am.

The Nasdaq is auctioning in a methodical manner. Tuesday’s big gap lower was faded. We found responsive buyers Tuesday and spent the rest of the session trading higher. Yesterday we opened gap up and spent the entire session slowly working the gap fill lower. Today’s gap up is on the professional variety but still at risk of being filled. Conversely, there I an open gap up at 4476.25 which may entice the market upward. Overall the market has been an objective mechanism of price discovery all week.

Heading into today, my primary expectation is for sellers to push into the overnight inventory. There’s a big HVN at 4450 that might behave like a magnet once markets open. I will look for buyers to defend north of 4440 to set up a move to fill the gap up to 4476.25.

Hypo 2 is gap and go higher, push up to 4476.25 and find sellers who defend the 05/04 range.

Hypo 3 sellers push down though 4440 and sustain, setting up a fill of the overnight gap to 4424.25.

Hypo 4 bulls sustain trade above 4476.25 to target the NVPOC at 4489. Stretch target is 4493.

Levels:

NQ_MarketProfile_05142015

Gap Hunter

333 views

Nasdaq futures are up a touch as we head into cash open. The index spent most of the evening trading up following yesterday’s strong reactive buying. Range overnight managed to press 2nd sigma while volume stayed compressed into its normal range.

On the economic calendar we saw Advance Retail Sales at 8:30am which solicited a choppy but ultimately sideway reaction. We also have Business Inventories at 10am and Crude/Distillate Inventories at 10:30am.

Going back to the charts, yesterday we opened pro gap down and drove lower from the opening bell. The range was enough to expand volatility for a third week. It also managed to fill last Thursday’s pre NFP gap. The auction ultimately stalled out and found responsive buyers. We then worked higher to close the overnight gap up to 4431. A few attempts were made to reenter Monday’s range but ultimately we traded lower into the bell as the market was tasked with absorbing a heavy amount of supply in the final hour and a half of trade.

Heading into today, we are priced to open on the high-end of yesterday’s range. My primary expectation is for seller to push into the overnight inventory and trade down to 4420.50 to close the overnight gap. This market has demonstrated a strong proclivity to close gaps lately so it might as well continue doing so. From there sellers may continue pushing to 4416 where I will look for signs of buyers and then two way trade ensues.

Hypo 2 buyers push off the open to take out overnight high 4447.75 to target 4455.50 where sellers come in and two way trade ensues.

Hypo 3 buyers take out 4455.50-4457.75 and continue higher to target the open gap up at 4476.25.

Hypo 4 breakdown below 4416.25-4412 opening us up to trade down to 4395.50.

Levels:

NQ_MarketProfile_05132015

Down The Slip Stream

292 views

Nasdaq futures are pro gap down this morning. The action took us to second sigma range and volume, and effectively erased the entire pop from Nonfarm payroll only two sessions back.

The profile was thin, single prints, and created the scene for a fast move. The fact it was traversed overnight may be a positive. This occurred while none of the underlying components were trading. Therefore, it will be the responsibility of the market to balance itself back in line with its components come open.

Perhaps contributing to the selling was Fed’s Williams who, for whatever reason, went on CNBC yesterday evening and said “Every FOMC meeting is on the table for a rate hike.”

Heading into today, the only economic event of note is the Monthly Budget Statement at 2pm.

Yesterday we printed a normal variation down day and closed on session low after briefly taking out Friday’s high in the morning. Heading into today my primary expectation is for buyers to push into this overnight inventory and trade up to 4408. From there I expect supply to come in and us to continue trading lower to work toward 4367.50.

Hypo 2 buyers blow up through 4408 and push us back up to 4433.

Hypo 3 sellers gap-and-go lower, take out 4367.50 early and target 4357.50. Levels:

NQ_MarketProfile_05122015

In The Groove

243 views

Nasdaq futures are trading quietly ahead of this week’s start. After two Monday’s of starting out with a big gap up and volume elevated, today is set to open near-flat on volume low-end normal.

The economic calendar is quiet today. At 10am we’ll hear the latest read of the Labor Market Conditions Index. This is a low/medium impact number. Earning’s season is moving onto b-role companies and less likely to impact the overall market. The dominating headline risk remains with the eurozone and their Greek situation.

Friday price went pro gap up after Nonfarm payroll data received a positive reaction. We spent the rest of the session trading sideways with a slight upward bias. Since then, during globex, price managed to test below Friday’s low briefly before rotating 10 points higher.

Heading into today, my primary expectation is for 2-way auction to give way to more price discovery up. Buyers look to target a 05/04 gap fill up to 4476.25.

Hypo 2 is sellers take out overnight low setting up a test of the single prints down at 4437. If they can push down into them, look for a give-back of the NFP boost all the way down to 4403.25.

Hypo 3 is bracket trade between 4456 and 4445.

Levels:

NQ_MarketProfile_05112015

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