The NASDAQ was pushing a bit more aggressive today, both ways, in a manner of trade that resembles a slug fest between higher time frame buyers and sellers.

Either can claim victory on the session.  In the case of a draw and until further notice, the ‘W’ goes to the bulls.

However, the tape is showing the day-types the tend to occur at-or-near inflection points, peaks and troughs, the intermediate highs and lows.

Let’s run through the recent string of odd-ball occurrences, shall we?

1. Monday, 8/8/2016 – the oddly named ‘Normal Day’ which happens about 6% of the time over the past 5 years (personal study).
2. Thursday, 8/11 – another Normal Day
3. Tuesday, 8/16 – Normal day
4. Wednesday, 8/17 – Neutral Day (about 20% odds, or 1-in-5)
5. Thursday, 8/18 – Neutral Day
6. Today, Monday 8/22 – Normal Day

We have seen more normal days in the 11 trading days then we have all year.  Together they blob up to form this big ole’ fat drip-shaped balance:

Funny how nature enjoys certain shapes and structures isn’t it?  Our good Italian friend Leonardo Fibonacci liked to write mathematical models of pine cones.  These days we build balance and trade the levels it produces.

The tear drop shape is a bit more clear when you view all trading activity through the lens old school, TPO market profile:

Writer’s note: Perhaps it looks more like an icicle, especially when you tilt your head to the left, but I’m really trying to make the Forrest Gump Headline/Photo combo work.

Markets in balance tend to stay in balance until acted upon by a force greater than the gravitational pull of the collected balance.

Writer’s note(2): I just made that up, but it has a nice ring to it, doesn’t it?

The higher time frame seemed active today, but neither participant showed any initiative.  Fade rips and dips back to the mean looks like the move until Jackson Hole.

The NASDAQ is liquid at these levels and has formed a fat balance.  Trade accordingly.

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NASDAQ futures are coming into Monday gap down after an overnight session featuring normal range and volume.  Price drifted lower until about 3am when a strong bid pushed the market up through Friday’s high briefly.  The auction then failed and reversed the entire move.

On the economic docket today we have a 3- and 6-month T-bill auction at 11:30am.

Last week we tested higher, then lower, but ultimately marked time on the NASDAQ.  Here are the returns of each major index last week:

On Friday the NASDAQ printed a normal variation up.  The impulsive move higher late Friday morning was reversed then price worked higher to end the choppy session.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4807.  Look for sellers ahead of 4810 who work price down through the overnight low 4792.75.  Buyers step in around 4785 and 2-way trade ensues.

Hypo 2 sellers make a push off the open, take out overnight low 4792.75 and work lower, down to 4780.25 before two way trade ensues.

Hypo 3 strong buyers close gap up to 4807 then take out overnight high 4817.25 and continue up to close the 4822.75 gap before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ futures are coming into Friday gap down after an overnight session featuring normal range and volume.  Price worked lower overnight, down through yesterday’s low before settling into 2-way trade back inside Thursday’s range.

The economic calendar today literally only contains the Baker Hughes Rig count at 1pm.  There are no other economic events.  Not even low impact, non-eventful ones.  Baker Hughes will likely be a non-event.

For all intents and purposes, after 11am and aside from the 3:30 ramp, today is likely to be a non-event.

Yesterday we formed a neutral day.  We have been printing abnormal market profiles all week.  This tends to happen at-or-near inflection points.

Heading into today my primary expectation is for sellers to be active around 4800.  They go take out overnight low 4788 and push a liquidation down to 4780 before two way trade ensues.

Hypo 2 is for the overnight short sellers to be ransacked by a geyser of buy orders early on that push closed the overnight gap up to 4807.25.  Look for sellers up at 4810.50 and two way trade.

Hypo 3 strong buyers close gap up to 4807.25, sustain trade above 4811.25 setting up a move to close the gap up at 4822.75.

Hypo 4 full on liquidation takes us down to 4767.25 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ futures are coming into Thursday gap down after an overnight session featuring normal range and volume.  Price worked up through Wednesday’s high briefly before settling into balanced trade inside yesterday’s range.  At 8:30am Initial/Continuing jobless claims data came out mixed and the Philadelphia Fed reading was in line with expectations.

Also on the economic calendar today we have Leading Indicators at 10am and a 5-Year TIPS Reopening auction at 1pm.

Yesterday we formed a neutral extreme up.  Sellers were active on the open for a second consecutive day, aggressively driving price lower early on.  Then, briefly, they managed to extend price lower before finding a strong responsive bid before the FOMC minutes.

The bid pushed up through the day’s entire range, putting the market neutral.  Then FOMC minutes hit, third reaction yielded the buy signal, and we rallied through end of day, closing near the high making Wednesday a  neutral extreme day-type.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4803.50.  Sellers show up here and work price down through overnight low 4793.50.  A test of the excess low just below overnight low brings in a bid and two-way trade ensues.

Hypo 2 buyers close overnight gap up to 4803.50 then work through overnight high 4814 setting up a move to close the open gap up at 4822.75 before two way trade ensues.

Hypo 3 strong selling pushes down into the single prints below 4793.50 setting up a liquidation move to target 4780 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ futures are coming into Wednesday gap up after an overnight session featuring normal range and volume.  Price worked down to a new low on the week before finding a responsive bid back up to yesterday’s midpoint.

On the economic calendar today we have crude oil inventories at 10:30am followed by FOMC Meeting Minutes from the July 26-27 meeting.

Yesterday we printed the statistically rare normal day.  Sellers drove lower early yesterday morning after price opened gap down.  The initial balance was not breached for the rest of the day.  Near the end of the session a double low was formed at 4796.50.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4799.75.  They continue working lower, down through overnight low 4789.50 setting up a move to close the open gap down at 4781.25 before two way trade ensues.

Hypo 2 buyers show up around 4800 and work price up through overnight high 4809.75 and the market stalls out, goes range bound between 4810 and 4800.

Hypo 3 buyers push up through 4809.75 then sustain trade above it setting up a move to target Monday’s open gap up at 4822.75 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ futures are coming into Tuesday gap down after an overnight session featuring normal range and volume.  Price worked lower and took back most of Monday’s gains before settling into two-way trade.  At 8:30am the Consumer Price Index came in lower than expected and Housing Starts were above expectations.

Also on the economic docket today we have Industrial/Manufacturing Production at 9:15am, a 52-week and 4-week T-bill auction at 11:30am.

Yesterday we printed a normal variation up.  The week began with a gap up and buyers drove prices higher off the open.  Buyers attempted to continue exploring higher prices after lunch but stalled out after making a new high.  This introduced some responsive selling back down to the midpoint as the day ended.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4822.75.  From here buyers continue higher, up through overnight high 4825.50.  Look for responsive sellers around 4829.50 and two-way trade to ensue.

Hypo 2 sellers push down through overnight low 4811.50 and close the weekly gap down to 4804.25.  Buyers show up here and two-way trade ensues.

Hypo 3 strong sellers take out overnight low 4811.50, close gap down to 4804.25 then sustain trade below it setting up a move to target 4794.25 before two way trade ensues.

Hypo 4 strong buyers push up through overnight high 4825.50 then probe Monday’s high 4835.25.  Look for sellers up around 4841.25 and two-way trade to ensue.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ futures are coming into Monday gap up after an overnight session featuring normal range and volume.  Price worked up though all prior highs overnight before coming into two-way trade at the new levels.

On the economic docket we have NAHB Housing Market Index at 10am, 3- and 6-month T-bill auctions at 11:30am, and Long-term TIC flows at 4pm.

Last week the NASDAQ marked time, trading sideways with an upward drift, all week long.  Price worked slightly higher.  Here are the returns of each major index last week:

On Friday we printed a normal variation up.  Price went right down to Thursday’s low but failed to test below it, instead printing a weak-looking 2-day low along the 4787 mark.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4804.25.  From here sellers continue lower to take out overnight low 4805 then test Friday’s low and close the gap down to 4781.25 before two way trade ensues.

Hypo 2 sellers cannot close overnight gap.  Instead buyers show up around 4808 and continue working the market higher, up through overnight high 4818.50 and continue exploring higher prices.

Hypo 3 strong selling pushes down through the open gap at 4781.25 and continues lower.  Look for responsive buyers down at 4767.25.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ futures are coming into Friday flat after an overnight session featuring abnormally low range and volume.  This is the second time this week Globex has been so quiet it registered as abnormal.  Price held yesterday’s range on a balanced trading session. At 8:30am Advance Retail Sales came in well-below expectations.

Also on the economic docket today we have Business Inventories and U. of Michigan Confidence at 10am and the Baker Hughes rig count at 1pm.

Yesterday we printed a Normal Day, the statistically rare day-type that we also printed on Monday.  These tend to occur near inflection points.  After opening gap up the market drove to new highs early on and found a sharp responsive seller.  The rest of the session traded inside the first hour’s range, earning Thursday the Normal designation.

Heading into today my primary expectation is for sellers to work the market lower, down through overnight low 4796 then continue working lower to target the open gap down at 4781.25 before two way trade ensues.

Hypo 2 buyers push up through overnight high 4805.25 and work price up to 4819 before two way trade ensues.

Hypo 3 strong selling pushes down through 4781.25 and probes the week’s lows, below 4766.25 triggering a liquidation down to 4756.

Levels:

Volume profiles, gaps, and measured moves:

 

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NASDAQ futures are coming into Thursday gap up after an overnight session featuring normal range and volume.  Price worked higher overnight, taking out yesterday’s high twice–the first time triggering a responsive sale back down to the key 4782 level.  Heading into the open we are pinned at yesterday’s high.  At 8:30am Initial/Continuing Jobless claims came in below expectations.

Also on the economic docket today we have a 30-year Bond auction at 1pm.

Yesterday we formed a normal variation down.  Price worked lower early in the session to take out the weak overnight low.  Buyers stepped in ahead of the low print from Monday at 4766.25 and two way trade ensued.

Heading into today my primary expectation is for sellers to work into the overnight inventory but struggle to close the gap down to 4781.25.  Instead buyers show up at 4784 then go take out overnight high 4797.25.  Price continues probing higher, up through all-time high 4807.75 before two-way trade ensues.

Hypo 2 sellers do a full gap fill down to 4781.25 take out overnight low 4775.75 then probe below the weekly low 4766.25.  Look for responsive buyers down at 4757 and two way trade to ensue.

Hypo 3 strong buyers push up through all time high and target 4822 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

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NASDAQ futures are coming into Wednesday gap up after an overnight session featuring normal range and volume.  Price was balanced and held yesterday’s range on a Globex session that printed a weak low verse 4782.  At 7am MBA Mortgage Applications came in better than last week.

Also on the economic docket today we have crude oil inventory at 10:30am, a 10-year Note auction at 1pm, and a Monthly Budget Statement at 2pm.

Yesterday we printed a normal variation up.  Price opened gap up and drove to new highs.  Right at the measured move levels responsive sellers showed up and we settled into two-way trade, but sellers never closed the overnight gap.

Heading into today my primary expectation is for sellers to work into the overnight inventory and close the gap down to 4791.75.  Then we take out overnight low 4782 and target the open gap at 4779.50. Look for responsive buyers down at the naked VPOC 4773.75 and two way trade to ensue.

Hypo 2 buyers step in ahead of the gap fill, ahead of 4791.75 and work higher to take out overnight high 4800.25 the continue higher to probe above yesterday’s high 4807.75.  Look for price to continue higher, up to 4822 before two way trade ensues.

Hypo 3 liquidation takes hold, price pushes down through 4779.50 then sustains trade below 4773.75 setting up a test of the week’s low 4759.75.  Look for responsive buyers down at 4756.75 and two way trade to ensue.

Levels:

Volume profiles, gaps, and measured moves:

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