The overnight session was quiet as we head into a busy end-of-week. The NASDAQ printed a below normal 9 point range ahead of CPI, which served to expand the range a bit after a lower than expected increase in CPI was released. Overall, the range is still tight as we approach cash trade.
On these Wednesdays where we have FOMC announcements in the afternoon, we tend to see one or two actionable moves very early in the session and then a pause as the markets waits for the new information to release. Anything can happen, of course, but having a hypothesis or expectation for the early trade means if something else happens we are seeing unique behavior which warrants our attention.
I opened the topic of intermediate term balance to the open forum Sunday afternoon because its starting point was a bit grey at the time. Consensus was 08/25 seemed a proper start date and with that information the downside imbalance became abundantly clear. The fast move lower and subsequent retracement higher yesterday settled the imbalance, but they also stretched out intermediate term balance. Now I have pulled in data going back to 08/18 which gives the lower half of balance a bit more information. Yesterday confirmed our hypothesis that intermediate term we remain in balance when we revised back to the mean at 4066. I have noted the key intermediate term levels below:
I have noted the key price levels I will be observing on the following market profile chart:
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