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Tag Archives: $NQ_F

3 Days, 3 Pro Gaps

Futures have been busy inside the hours of globex. Futures have been busy during RTH. Futures, have been busy. The globex open was delayed last night while the exchange made an adjustment for a leap second. It’s rare, and weird, but if you’re a real market junky click here for the full CME documentation. Despite the shortened session we managed to print a highly abnormal range, beyond second sigma, on abnormally high volume. Greece officially defaulted on the IMF last night, but the session was otherwise without much headline volatility.

On deck this morning, we have ISM manufacturing at 10am but attention is likely to soon shift to tomorrow morning’s NFP release, set to be out a day early due to the markets being closed Friday.

Yesterday we printed a neutral day inside of the lower half of Monday’s trend day down. Sellers worked the overnight gap closed before buyers came in and in one swift rotation pushed through the entire range to put us neutral before we settled back to the mid.

The overnight action has created a curious case—we now have a gap below that likely needs to be resolved, but we’re also trading just below a few upside gaps. Also just above is the VPOC of the whole year at about 4450. Sellers roundly rejected the CVPOC Monday morning, but now we’re back up to test their conviction.

Heading into today, my primary expectation is for buyers to push off the open, gap-and-go style, to take out overnight high 4441.75. This sets up a move to the CVPOC at 4450 and the open gap at 4454 where we churn about before ultimately fading lower into the afternoon.

Hypo 2 sellers push into the overnight inventory to test yesterday’s range 4412.50 but stall ahead of the range setting up a move higher to take out overnight high 4441.75 and target the CVPOC/open gap 4450/4454.

Hypo 3 sellers push down through yesterday’s range 4412.50 setting up a gap fill to 4390. Sellers overshoot the gap and take out overnight low 4388.75 setting up a test of swing low 4368.25. This hypo will require heavy OTF participation because we’ve managed to form some decent structure below (see market profile).



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Working Another Pro Gap into Month-End

Nasdaq futures are priced to start month-end/quarter-end with a pro gap up. Prices worked higher for most of the overnight session and managed to print an above average range on above average volume. The action, overall, resembled an imbalanced drift higher and was confined to the bottom half of yesterday’s range.

At 9am the Case Shiller Composite was released and saw little reaction. At 9:45 we have Chicago Purchasing Manager, and at 10am Consumer Confidence. Overall, these economic events are likely to contribute to a volatile, choppy environment this morning.

Yesterday we came into the week pro gap down, an extreme gap that was driven by news over the weekend about Greece. After bulls mounted a half-gap fill they ran into sellers and the market rolled back over. We spent the rest of the session trending lower. There were signs of balance in the morning, but that quickly gave way to OTF selling. The volume was high at end-of-day and enough to shift the VPOC down near session low.

According to market profile theory, any entry in the direction of yesterday’s trend (short) is a risk free entry into today’s session because we are very likely to exceed its session low by at least a tick. Therefore my primary hypothesis today is for sellers to push into the overnight inventory to close the overnight gap down to 4380 setting up a test of yesterday’s low 4368.25. Look for sellers to target a move down to 4353.75. Look for responsive buyers north of 4347.25.

Hypo 2 buyers gap-and-go higher, stall out around 4411.50 and we roll over and close the overnight gap to 4380, test below yesterday’s low 4368.25 and quickly find responsive buyers and two-way trade ensues.

Hypo 3 buyers push up through 4414.25 and we work through the upper distribution to target 4430 then a stretch target of 4440.



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Starting The Week Pro Gap Down

Nasdaq futures are down as we head into the holiday shortened week after news from Greece began to deteriorate over the weekend. Futures opened and immediately pushed gap down to 4400 before a well-balanced, 2-way trade ensued. Volume is abnormal but not breaching the extreme 2nd sigma threshold. The range on trade post-gap down is elevated, but including the range of the gap we have extreme 2nd sigma range.

I envision this Greek news slowly fizzling out this week, but as for today, it’s likely to be of elevated importance. With headline risk high, we may see less impact to today’s only economic event—Pending Home Sales at 10am. Keep in mind, we have NFP data out on Thursday instead of Friday due to Independence Day (USA#1).

Last week we started with a big gap up and essentially spent the rest of the week fading it lower. On Friday liquidation accelerated through an air pocket present on the profile before finding responsive buyers to end the week.

Heading into today, my primary expectation is for buyers to push into the overnight inventory and test higher. Look for sellers to defend 4446 and two way trade to ensue, north of the overnight low 4400.

Hypo 2 buyers push up through 4446.75 and continue higher to 4467. If they can breach this levels as well, look for a throwback to the scene of the crime, the open gap up at 4481.75. Note, this is pro gap territory—thus attempting to fade it is an effort requiring “professional” resources. The half gap scenario above is more likely.

Hypo 3 we take out overnight low 4400 and test below prior swing low 4386.50. Look for responsive buyers otherwise liquidation grip the market and sellers push to target 4353.50.


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Super Balance

Markets pushed higher early this morning, and as we head into cash open price is entrenched in balance. Range is abnormally elevated on the overnight session and volume is close to abnormal too. The main feature of the overnight session is a 25 point rotation higher that hit right around 4am.

The Greek drama continues and at 7am Eurogroup Finance Ministers were set to meet.  At 8:30am Initial/Continuing jobless claims data, as well as Personal Income/Spending data were out and the initial reaction to the news is some slight selling. Also on the docket today is Market Composit PMI at 9:45am and Nat Gas Storage data at 10:30am.

Yesterday we printed a neutral extreme day, and quite an interesting one. Price went up and took out the prior swing high and order flow dried up. We spent the rest of the session working lower and went out near the session low.

This action followed what has been a frustrating week for bears. We started Monday with a big gap up and sellers have struggled to fade it. Instead we are churning and accepting these higher prices.

The result is a well-defined value area that we can work with. It spans from 4545 – 4511. The more time we spend inside this balance, the more likely it is to resolve higher and in congruence with the higher time frame trend.

Heading into today, my primary expectation is for buyer to push on the open to target 4541. From there I will look for sellers to defend the high end of value and two-way trade to ensue.

Hypo 2 is sellers push into the overnight inventory and close the gap down to 4514.50, setting up a test of VAL 4511. Look for buyers and two-way trade to ensue.

Hypo 3 sellers close overnight gap early, selling pressure persists, and we push to test the century mark 4500. Look for a liquidation if we pierce the air pocket below 4498.50.

Hypo 4 strong buyers, push up through 4545 and continue on to test above yesterday HOD 4555.25 to target measured moves at 4557 and 4565.75.



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Three Possible Outcomes for Today’s Trade

Nasdaq futures are a touch lower as we round the bend into cash open. The session featured normal range and volume while trading inside of yesterday’s range. This suggests we are in balance and nothing overnight changed that. The overnight profile features a weak low and the predominant feature of the session was a 16 point rotation lower around 5:30am, otherwise the session yields little clues on the day.

At 8:30am a buffet of economic numbers was delivered—most coming in-line or slightly better than expectations. At 10:30am we have crude oil inventories and at 2pm it appears a Greek Summit meeting is taking place over in the Eurozone.

Yesterday we printed a normal variation down but saw little initiative selling after going range extension down. Instead we grinded back up into the balance formed by Monday’s neutral day. Starting the week with a big gap up, after starting the prior week with a big gap down, may make participants hesitant to chase price higher. However, the longer we can hold balance up here, building acceptance of these prices, the more likely it becomes that we test contract high and explore for buy stops.

Heading into today, my primary expectation is for buyers to push into the overnight inventory and close the gap up to 4541.25. From there I will look for them to take out overnight high 4545.75 setting up a move to target 4557 then 4565.75. Stretch targets are 4579.50 and 4596.

Hypo 2 buyers struggle while closing the overnight gap and we push down to take out overnight low 4526. Look for price to continue lower and look for buyers around 4511.75 then continued balanced trade.

Hypo 3 sellers push down through 4511.75 to target the 4500 century mark. If they can push trade below 4498.50 look for liquidation to take hold, and a fast move down to 4465.25 with a potential gap fill target down at 4454.



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Overnight Action Quite Calm

Nasdaq futures are priced to gap up slightly heading into Tuesday. The overnight session was a balanced-two way chop along yesterday’s midpoint. The range printed is normal on abnormally low volume.

At 8:30am Durable Goods data came in weaker than expected, and at 9am House Price Index did too. The initial reaction to both news items is selling. Also on the docket, we have a morning loaded with low impact events including Markit Manufacturing PMI at 9:45am, New Home Sales at 10am, and Richmond Fed at 10am as well.

Yesterday we started the week with a big gap up after news out of the Euro zone sent world equity markets higher. The Nasdaq managed to close the open gap it left behind from May 28th during the opening trade. Buyers briefly became initiative, pushing us range extension up, before responsive sellers stepped in and pushed us neutral.

Heading into today, my primary expectation is for a choppy open. The flurry of news items and balanced overnight session suggest we chop between 4545.75 – 4531.75 before heading higher to test above yesterday’s HOD 4552.25 to target a measured move up to 4557, then 4565.75.

Hypo 2 sellers break the balance to target the MCHVN at 4512.75. Look for responsive buyers at 4509.75 otherwise the open gap down at 4499 becomes a likely magnet.



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Chunking A Few Scenarios

Nasdaq futures saw an active session overnight with both range and volume coming in a bit ahead of normal. Price spent most of the evening pushing lower until finding buyers ahead of yesterday’s cash session low 4386.50. Since then, we’ve spent most of the early morning working higher.

At 8:30am, Housing Starts came in a bit worse than expected and Building Permits a bit better—thus the data was mixed. The initial reaction to the news is buy flow. Aside from those events, the US economic docket is empty for the day, and investors are likely focusing on tomorrow afternoon’s FOMC Rate Decision.

Yesterday the market opened pro gap down and saw an aggressive liquidation-type push lower early. The price action exceeded last week’s low 4390.25 before finding a sharp responsive bid. After a thorough churn at the 4400 century mark, intraday responsive buyers became initiative and we spent the rest of the session grinding higher. Buyers managed to trade up to the 06/09 open gap left behind last week Wednesday when we opened gap up and trended higher. This action exhibits the continued methodical manner by which our market is trading—very healthy overall.

Heading into today, my primary expectation is for buyer to work into the overnight inventory to close the overnight gap up to 4426.75. This sets up a push above overnight high 4428.75 and puts buyers well on their way to closing the weekly gap up to 4448.25. Look for sellers to defend last Friday’s range low 4440.50. Gauge short term control on whether buyers are able fully close the gap up to 4448.25 or if instead they fizzle out ahead of it.

Hypo 2 buyers push into overnight inventory but stall around 4421.50 and price rolls over. Sellers target overnight low 4395.75 setting up a test of Monday’s session low 4386.50. If buyers cannot defend then look for liquidation to take hold and push price down to 4360.50.

Hypo 3 sellers gap-and-go lower, take out overnight low 4395.7 5early and push to 4360.50 where we find responsive buying.

Hypo 4 churn takes hold, as investors wait for tomorrow’s FOMC decision, between 4433.50 and 4396.25.


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First We Cover A Few Scenarios

Nasdaq futures are lower as we head into option/contract expiration week. The session opened gap down, a somewhat uncommon occurrence, and then spent the rest of the session trading in a normal 20 point range on somewhat normal volume. Volume analysis is a bit buggy right now as some volume is still trading on the June contract while most has rolled onward to the September contract.

The economic calendar has a few events today—at 9:15am Industrial/Manufacturing Production, at 10am the NAHB Housing Market Index, and at 4pm the Net Long-term/Total TIC Flows. However, attention will quickly shift to Wednesday afternoons Fed Rate Decision which is likely to be a high impact event regardless of the decision/verbiage. We are also still dealing with headline risk out of the Eurozone.

Last week we came into Monday gap down and proceeded to sell off for most of day and into Tuesday morning. By Tuesday afternoon, prices were off the lows and Wednesday featured a trend day up. After a brief continuation higher Thursday, equities rolled over and grinded lower into Friday’s closing bell.

Heading into today, my primary expectation is for sellers to push lower and work below 4405 to test the 4400 century mark. Look for sellers to target the NVPOC at 4405.50 then some churn at 4398 before continuing lower to test below last Tuesday’s low 4390.25.

Hypo 2, buyers push into the overnight inventory, take out overnight high 4437.25 to set up a gap fill trade to 4448.25. Look for responsive sellers to defend Friday’s range.

Hypo 3 churn, 2-way trade south of the overnight gap (4448.25) followed by liquidation in the afternoon.

Hypo 4 early push lower to NVPOC 4405.50 and sharp responsive buy up to close the gap at 4448.25 and continue higher.



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Gap Filling Machine

Nasdaq futures are up a touch as we head into US market open after a second globex session of normalized range and volume. The overnight session compressed in the upper quad of yesterday’s range before making a burst higher.

At 8:30am we heard Advance Retail Sales figures as well as Initial/Continuing Jobless claims. We also have natural gas storage data at 10:30am.

Yesterday we printed a trend day, for the most part, before settling out in the afternoon and forming balance/acceptance. The last three days have been an exercise in clearing up old open gaps. On Tuesday we went and closed the 5/13 gap and bounced. On Wednesday we continued lower before finding a sharp responsive buy. Then yesterday we pushed higher to close the 6/5 gap and the 6/4 gap.

Bulls will have to consider the fact we left an open gap behind yesterday morning down at 4431. If this market has consistently demonstrated anything this year, it has been a strong proclivity to go back and close gaps.

Nevertheless, this type of methodical trading suggests we’re in a healthy market with multiple time frames participating.

Heading into today my primary expectation is for sellers to push into the overnight inventory to close the overnight gap to 4488. Look for buyers to defend north of 4482 who continue pushing higher to take out overnight high 4500. Overhead targets are 4512.75 and 4515.50.

Hypo 2 buyers push early and take out overnight high 4500 and continue higher to explore the LVNs at 4515.50 & 4520.50. Look for responsive sellers at 4529.50.

Hypo 3 Churn inside the upper quad of yesterday’s range 4473.50 – 4500.


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Hey, A Normal Overnight Session

My expectation heading into the week was for volatility to be low in the beginning of the week. And while most other indices saw volatility decrease, the Nasdaq has been ripping around, especially overnight.

However volatility receded during this morning’s globex session, and we’re heading into cash open with a normal range and volume overnight session in tote.

This is a slow week for economic events, but the pace will pick up a bit on the tail end of the week. At 7am we had MBA Mortgage Applications, at 10:30am Crude/Gas Inventories, and at 2pm we have a Monthly Budget Statement. Tomorrow morning BMO we have Advanced Retail Sales.

Yesterday we printed a neutral day, and nearly a neutral extreme day. The variation that qualifies a neutral day as extreme, at least in my unwritten book, is closing in the upper quadrant of the day’s range. Neutral days feature a range extension on both sides of the initial balance and tend to occur at-or-near inflection points. The session also printed a healthy-looking excess low that may stick for the remainder of the week.

Heading into today, my primary expectation is for seller to push into the overnight inventory and close the gap to 4431. From here, it’s not a big distance to take out the overnight low 4430.50. Look for responsive buyers at 4411.50-4407.50 and two way trade to ensue, south of ONH 4451.75.

Hypo 2 buyers gap-and-go higher, instantly leaving unfinished business in their wake, to take out overnight high 4451.75 and continue exploring higher to target 4480.

Hypo 3 sellers push down through 4407.75 setting up a test of yesterday’s low. Look for responsive buyers from 4387.25 – 4379.



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