The Nasdaq is starting the week flat after an abnormally docile overnight session. Both range and volume are compressed below normal which is even more radical given the longer duration of the Sunday/Monday globex session.
Last we the market started at swing highs and spent three days [one, Monday, a holiday] trading flat before making a two day upward thrust. Friday’s action resembled a trend day although not an exceedingly strong trend day.
We have Existing Home Sales at 10am and Dallas Fed at 10:30am. Traders are already looking forward to Tuesday and Wednesday when Fed Reserve Chair Yellen is set to testify before the U.S. Senate and House. They will be listening for any hint of when the Fed will raise interest rates.
Heading into today, my primary expectation is for balanced, two-way action. Sellers may push into the long inventory a bit to test down into Friday’s move. I will look for responsive buyers to defend from 4423 -4420 area.
Hypo 2 is buyers continue drifting the market higher and sustain trade above 4435.
Hypo 3 is a sharp move down through 4423-20 area to test 4413 then 4408.
See what I am seeing, below:
