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Roll-forward, ECB Bazooka: Tricky Day Coming Up

NASDAQ futures are set to start today gap up after an overnight session featuring extreme range on elevated volume.  Trade was balanced overnight, quickly exceeding and sustaining trade above the Wednesday close before trending higher from 7am onward.  The trend was driven by news from Europe, that their Central Bank has cut borrowing rates to -0.40% and also expanded their quantitative easing program to include the purchase of corporate debt.  At 8:30am Initial/Continuing Jobless claims data came out better than expected.

See also: Draghi Surprises To The Upside And Throws The Kitchen Sink at Markets

Also on the economic docket today we have a 30-Year bond auction at 1pm and the Monthly Budget Statement at 2pm.  Today is also rollforward.  After the open, most active participants will begin trading the June index futures contract instead of the March, which expires next Friday.

Yesterday we printed a normal variation up.  Price opened gap up but well within the Tuesday range and sellers quickly close the gap with an opening drive down.  Sellers were not able to push the market down below the Tuesday low before responsive buyers stepped in and worked price range extension up.  Sellers made a second aggressive attempt lower, but were not able to push the market neutral for a third consecutive day.  Instead buyers defended session low and then worked price slowly higher for the remainder of the session.

Heading into today my primary expectation is for sellers to push into the overnight inventory and work price down to 4310.  Buyers defend here, ahead of the gap fill, and we work higher to take out overnight high 4347.50 before testing above the weekly high 4355 before two-way trade ensues.

Hypo 2 sellers push a full gap fill down to 4294.25 then set their sights on the overnight low 4283.50.  Selling accelerates and we trade down to 4269 before two way trade ensues.

Hypo 3 buyers jam the gap and go drive higher.  Take out overnight high early 4347.50 then sustain trade above the weekly high 4355 setting up a move to target the 4400 century mark.  Stretch target is 4406.75.

Levels:

03102016_NQ_MP

Volume profiles, gaps, and measured moves:

03102016_NQ_VPgapsMeasuredMoves

 

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The Resilience Is Admirable

For two weeks I was bearish and wrong.  This week I came in neutral, but Switchboard [coded context] keeps nudging its bias long, then back to neutral, flip-flopping, if you will.

The conditions are not conducive for trading inside-out.  Trying to initiate directional trades is likely to chop you out.  Instead you have to work from the outside-in, fading moves back to value.

Trading conditions like this mean markets are in balance.  They are resilient against attempts higher and lower, and are structurally sound.

Aside from fading extremes, this type of action also lends itself to stock picking–a pastime I haven’t actively pursued yet this year.

All the data points to neutrality with a very slight bullish bias.  The huge value areas in play are hard to bust loose from.  Stock picking might be the move, but I am not participating.  The markets are likely to remain in wait-and-see mode until we hear from the European Central Bank tomorrow, resistant to any directional attempts.

SEE ALSO: All Eyes on Mario Draghi

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NASDAQ Acting Normal; Looks Healthy

NASDAQ futures are set to begin Wednesday trade gap up after an overnight session featuring normal range and volume.  Price spent most of the session working higher and managed to hold the Tuesday range.  At 7am MBA Mortgage Applications came out significantly better than the previous month.

Also on the economic docket today we have Wholesale Inventories at 10am, crude oil inventories at 10:30am, and a 10-Year Note auction at 1pm.

Yesterday we printed a neutral day, the second consecutive neutral day.  The market opened gap down and spent the morning filling the gap, much like Monday.  In the early afternoon, the market attempted to continue going higher but formed a failed auction as it attempted to re-enter the mutli-day balance formed from March 1st-7th.  We then traversed the entire range to push the session neutral before the settlement period saw enough buying the fend off the ‘neutral extreme‘ nomenclature.

Heading into today my primary expectation is for sellers to push into the overnight inventory and close the gap down to 4272.  Look for responsive buyers ahead of overnight low, however.  Buyers step in around 4265 and make a move to take out overnight high 4299.  Range stays tight as responsive sellers defend the 4300 century mark and two way trade ensues.

Hypo 2 sellers push the gap fill down to 4272 then set their sights on overnight low 4263.  From here selling continues to target 4251 before two way trade ensues.  Should the selling accelerate, the stretch target is 4234.25.

Hypo 3 buyers gap and go, take out overnight high 4299 early on and sustain trade above 4300 setting up another attempt back into the March 1st-7th inventory, an attempt back above 4310.  The achieve it setting up a move up through to 4315.  Sellers likely respond here, at least on the first attempt.  Stretch target is micro-composite value area high 4330 then 4337.75.

Levels, note the healthy balance distributions currently in place:

03092016_NQ_MP

Volume profiles, gaps, and measured moves:

03092016_NQ_VPgapsMeasuredMoves

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Slight Uptick in Globex Volatility

NASDAQ futures are set to enter Tuesday gap down after an overnight session featuring elevated range on normal volume.  Price pushed lower early on, deep into last Tuesday’s conviction range before finding a responsive bid and trading back into the Monday range.

The economic calendar is quiet today, but we have a 4-Week T-Bill auction at 11:30am and a 3-Year Note auction at 1pm.

Yesterday we printed a neutral day.  We came into the week gap down.  Sellers made an early attempt lower but were thwarted by responsive buyers who worked up to close the overnight gap.  Just after NYC lunch a strong sell hit the market and price traversed the entire daily range putting the session neutral.  By the close a responsive bid worked price essentially back to where the day began.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4300.25.  From here look for a move to take out overnight high 4304.  Look for responsive sellers up at 4309.50 and two way trade to ensue.

Hypo 2 buyers strong, close gap at 4300.25 then push up through and sustain trade above 4309.50 setting up a move to target 4320 then 4330.

Hypo 3 sellers step in ahead of the overnight gap fill, around 4291 and push lower to test below the Monday low print 4268.75.  Responsive buyers step in ahead of 4259 and two way trade ensues.

Hypo 4 strong selling works down through the Monday low 4268.75 and continues lower to target overnight low 4251.50.  Stretch target is 4234.50.

Levels:

03082016_NQ_MP

Volume profiles, gaps, and measured moves:

03082016_NQ_VPgapsMeasuredMoves

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Volatility Vanishes as March Gets Underway

NASDADQ futures are set to open gap down after an overnight session featuring normal range and volume.  Price spent most of Globex trading down, but in a slow and methodical manner.  As we head into the open, price is pressing down into the low-end of our multi-day balance.

At 10am we’ll hear a read of the Labor Market Conditions Index Change, and 11:30am both a 3- and 6-month T-Bill will be auctioned, and at 3pm Consumer Credit data is set for release.

Last week volatility receded significantly, the most we’ve seen all year.  There was a big trend day Tuesday then the rest of the week was spent consolidating on the upper quadrant of the move.

Friday printed a normal variation up day, with sellers responding late in the session to close the day flat.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4323.  From here look for a move up to 4333 before two way trade ensues.

Hypo 2 seller push off the open, take out overnight low 4296 and trigger a liquidation down to 4279.  Look for responsive buyers here and two way trade to ensue, perhaps with a late day gap fill up to 4323.

Hypo 3 sellers accelerate down through the zipper, down through 4279 setting up a full-on liquidation down to 4234.50 before two way trade ensues.

Hypo 4 strong buyers close overnight gap up to 4323 and push and sustain trade up above 4333 setting up a move to test last Friday’s high 4355.

Levels:
03072016_NQ_MP

Volume profiles, gaps, and measured moves:
03072016_NQ_VPgapsMeasuredMoves

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Strong Jobs Report Puts Bid in Market

NASDAQ futures are coming into the session gap up after an overnight session featuring normal range and volume. Price held yesterday’s mid before working up to the weekly high. At 8:30am Non-Farm Payrolls came out strong.   US February Nonfarm Payrolls +242k vs +195k expected and +151k previous.

Also on the economic docket today we have the Baker Hughes rig count at 1pm.

Yesterday we printed a normal variation down. Price opened flat and sellers worked into the tape early on. They pushed below the Wednesday low briefly before finding a responsive bid and working back up through a good part of the range.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4320.75. from there look for a move down to 4309.25 before two way trade ensues.

Hypo 2 Buyers push off the open, take out overnight high 4339 and work higher to test above this week’s globex high 4357.50 before two way trade ensues.

Hypo 3 strong sellers take price down through 4309.25 setting up a move to test yesterday’s low 4293.50 setting up a liquidation down to 4279 before two way trade ensues.

Levels:

03042016_NQ_MP

Volume profiles, gaps, and measured moves:

03042016_NQ_VPgapsMeasuredMoves

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Futures Pause Ahead of Tomorrow’s Job Report

NASDAQ futures are coming into Thursday flat after a second consecutive normal overnight session.  Statistically speaking, both range and volume were normal on a balanced session which managed to hold and slightly build upon yesterday’s range.  At 8:30am Initial/Continuing Jobless claims data came out slightly worse than expected.

Yesterday ADP Employment data looked better-than-expected.  However both job reports are merely a preview for tomorrow morning’s Non-farm Payroll data, which is the biggest economic event this week.

Also on the economic calendar today we have ISM Non-Manufacturing, Factory Orders, and Durable Goods at 10am.

Yesterday we printed a neutral extreme up day.  We came into the day gap down and spent most of the session slowly working lower.  During the afternoon session the market printed a failed auction when it 1-ticked the low-of-day then sharply reversed.  Price then traversed the daily range and exceeded the morning high by 3-ticks before closing in the upper quadrant, earning the session a neutral extreme classification.

Heading into today my primary expectation is for buyers to work the market higher.  Look for a move to close the Tuesday gap up at 4337.50 then up through overnight high 4344.50.  Look for responsive seller just above overnight high and for two way trade to ensue.

Hypo 2 strong buyers push up through overnight high 4344.50 then set their sights on yesterday’s globex high 4357.50 before two way trade ensues.

Hypo 3 sellers work down through overnight low 4317.50.  Look for responsive buyers down at 4308.75 and two way trade ensues.

Levels:

03032016_NQ_MP

Volume profiles, gaps, and measured moves:

03032016_NQ_VPgapsMeasuredMoves

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The Day After a Trend Day

NASDAQ futures are coming into Wednesday down 10 points after an overnight session featuring normal range and volume.  Price managed to extend upon yesterday’s trend during Globex and push deep into 01/07 range before setting into two way trade along the upper quadrant of yesterday.  At 8:15am ADP Employment data came in better-than-expected.  The initial reaction is selling.

Also on the economic calendar today we have Crude Oil inventories at 10:30am and Fed Beige book at 2pm.

Yesterday we printed a trend up, or conviction buying day.  After opening gap up, initiative buyers stepped in big time and rotated the market higher.  Their accumulation was sustained throughout the entire session and the market closed on session high.

Heading into today my primary expectation is for buyers to press into the overnight inventory and close the gap up to 4337.50.  Look for responsive sellers up at 4347.50 and then a move to take out overnight low 4325.50 before two way trade ensues.

Hypo 2 buyers close gap up to 4337.50 then sustain trade above 4347.50 setting up a move to target overnight high 4357.75.  Stretch targets to the upside are 4398.75 then 4406.50.

Hypo 3 sellers push down through overnight low 4325.50 and continue lower to test the 4300 century mark before two way trade ensues.

Levels:

03022016_NQ_MP

Volume profiles, gaps, and measured moves:

03022016_NQ_VPgapsMeasuredMoves

 

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Crowded Price Action To Start The New Month

NASDAQ futures are set to gap up after an overnight session featuring extreme range on elevated volume.  Price worked below the Monday low print early on but held last Thursday’s range before turning in a strong rotation higher.  Since then price has balanced around the midpoint from yesterday’s trade.

On the economic calendar today we have ISM Manufacturing and Construction spending at 10am followed by a 52- and 4-week T-Bill auction at 11:30am.

Yesterday we printed a neutral extreme down day.  An early two-way auction gave way to buying which stalled before last week’s high.  Sellers then worked price through the entire range and we closed the day near session low.  Overall price action is flat as buyers and sellers crowd into these price levels.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4203.25.  From here look for responsive buyers to emerge and work to target overnight high 4242.50 before two way trade ensues.

Hypo 2 buyers take out overnight high 4242.50 early on but stall out ahead of 4250 setting up a move to fill the overnight gap down to 4203.25.  Look for sellers to stall out around the 4200 century mark and two way trade ensues.

Hypo 3 buyers take out overnight high 4242.50 early and work up through 4250 setting up a move to target 4270 before two way trade ensues.  Stretch target is the “google” gap up at 4289.75.

Hypo 4 sellers are aggressive, close overnight gap down to 4203.25 then take out overnight low 4180.25 to target the MCVPOC at 4171.  Sellers continue lower to target 4151 before two way trade ensues.

Levels:

03012016_NQ_MP

Volume profiles, gaps, and measured moves

03012016_NQ_VPgapsMeasuredMoves

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Stocks Begin Leap Day Flat

The NASDAQ futures are priced to start the week flat after an overnight session featuring elevated range and volume.  Price struggled to hold Friday’s lower quadrant before giving way to selling that poked the micro-composite low volume node [MCLVN] before buyers stepped in.  The MCLVN is lined up with the support level buyers defended numerous times last Thursday.  Since then buyers spent the morning working price back to flat.

On the economic calendar today we have Pending Home Sales at 10am, 3- and 6-month T-Bill auctions at 11:30am.

Last week was choppy.  We came into the week with a big gap up and buyers sustained the gap through Monday.  Tuesday was a slow trend lower ahead of a large gap down into Wednesday.  An early balanced auction gave way to a strong trend up.  Thursday extended upon those gains.

Last Friday price opened gap up and spent the rest of the session on a slow grind lower.

Heading into today my primary expectation is for buyers to work price up through overnight high 4238.50.  Look for sellers up at4242.50 and two way trade to ensues above 4200.

Hypo 2 buyers push up through 4242.50 and sustain trade above it setting up a secondary leg to target 4270 before two way trade ensues.

Hypo 3 sellers work lower off the open to test below last Friday low 4225.  Sellers accelerate lower from here to target 4200 then overnight low 4184.50.  Look for a strong responsive bid at the MCVPOC 4171 and two way trade ensues.

Levels:

02292016_NQ_MP

Volume profiles, gaps, and measured moves:
02292016_NQ_VPgapsMeasuredMoves

Comments »